Assumable mortgages are quickly becoming a thing of the past. It used to be that mortgages were given with the clause that basically anyone could take over the payments. However, since these mortgages were 20 or so years ago, the number that are still out there are quickly diminishing as the majority of buyers obtain their own mortgage. Now, a mortgage nowadays may claim to be assumable, but it’s not like it once was, and the person assuming the loan will still have to qualify pretty much just like the original person who got the mortgage. Hope this helps…
question on assumable mortgages - Posted by Terrance
Posted by Terrance on November 20, 2002 at 20:13:36:
I have read quite a bit of info from investors lately
about “assuming a sellers mortgage” in order to aquire a home with 0 down.
This seems great in theory, but I have recently spoken with a couple of lender’s who stated that the only assumable morgages out there are FHA. That is with the exception of a few older mortgages. #1 it just seems to easy. #2 it seems like a lot of risk for the lender/bank
to let “just any Joe Schmoe” assume a morgage, especially
a 2nd. #3 with low interest rates, why would a bank want to let just anyone take advantage and not refinance when interest rates go up.
I am new to investing and still have much to learn. In fact I am currently working on my first deal. I would greatly appreciate some accurate info/insite on this if possible.
Re: question on assumable mortgages - Posted by phil fernandez
Posted by phil fernandez on November 21, 2002 at 12:40:03:
When we talk about assuming an existing mortgage, we are really talking about taking over the property “subject to” the existing mortgage that is already on the property. We are not formally assuming the mortgage.
Check the archives on this. There is enough reading on this subject to keep you busy for a week and a day.