An assumable mortgage is a type of mortgage loan that allows a borrower to take over the existing loan of another borrower, while keeping the original terms and conditions of the loan intact. This can be beneficial for borrowers who are unable to obtain a new mortgage due to credit or income issues. The assumable mortgage can also be beneficial for buyers in a rising interest rate environment, as they can take over the existing loan at a lower rate than what is currently available.

Many government-backed mortgages (including USDA, FHA and VA loans) are assumable if you meet certain requirements. To assume a mortgage, you’ll take many of the same steps you would if you applied for a new mortgage, including completing an application and letting the lender check your credit report. The lender may also require documentation for proof of income (like W-2s and prior tax returns).


Pros of an assumable mortgage include:

* Lower interest rate: The assumable mortgage allows the borrower to take over the existing loan at a lower rate than what is currently available.
* Easier to qualify: The assumable mortgage does not require the borrower to go through the same qualification process as a new mortgage.
* Faster closing: The assumable mortgage can close faster than a new mortgage, as the existing loan terms and conditions are already set
* The seller may be able to sell their property faster by offering an assumable mortgage.
* Assumable mortgages can be an attractive option for buyers who are self-employed.


Cons of an assumable mortgage include:

* Limited availability: Not all mortgages are assumable, so it may be difficult to find one that meets your needs.
* Higher fees: The assumable mortgage may come with higher fees than a new mortgage, such as closing costs and origination fees.
* Risk of default: If the original borrower defaults on the loan, the new borrower may be held responsible for the remaining balance.

Overall, an assumable mortgage can be a good option for some buyers, but it’s important to carefully consider the terms of the existing loan and compare them to other options before making a decision. Working with a knowledgeable real estate agent and mortgage lender can help you understand your options and make the best decision for your financial situation.


Below is a list of homes available for sale with an assumable mortgage.

Let us know if you have any questions about them.  We are happy to help you find the perfect home.


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