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Assumable Loan FAQ

What is an Assumable Loan? These loans may be passed on from a seller of a home to the buyer. The buyer "assumes" all outstanding payments. Usually a seller will negotiate the buyer to pay for any owned equity in cash and then just pick up the remaining payments on the assumable loan. Apply Now for an Assumable Loan!

How Can I find out if a loan is assumable? Check over the original loan documents and see if it lists the loan as assumable. If you have difficulty finding out if the loan is assumable, check with the lender or have an attorney review the loan documents. Apply Now for an Assumable Loan!

Are Assumable Loans good for home buyers? When interest rates are high, assumable loans are more popular to take over because you might benefit from a lower interest rate that the original home owner got during a different rate environment. However, in today's low mortgage interest rate market, assumable loans are normally not worth a buyers time, money and effort. With rates low, buyers are probably better off to get their own financing. Click Here to Apply for Your New Mortgage Low with a Low APR!

What costs are involved with assumable loans? It depends on the lender and the loan. Some assumable loans are inexpensive to close. However, many buyers to not have enough cash to buy out the existing owner's equity in the home and they need to get subsidiary financing to cover the equity already paid on the loan that is assumable. The closing costs, higher interest rate (because it's in second lien position behind the original mortgage) make it usually not worth the time and money.

Our official recommendation in today's market place is to get your own financing. At the very least, you should apply for a mortgage and compare costs and rates versus assuming the existing mortgage.

To find out what your estimate closing costs and interest rates will be, click here and fill out the form.