What is an assumable mortgage?

An assumable mortgage is a type of mortgage loan that can be transferred to another borrower. In California, an assumable mortgage is a loan that allows the buyer of a property to take on the existing mortgage of the seller, rather than applying for a new loan. This can be attractive to potential buyers, as it often means they can obtain financing at a lower interest rate than they could get on their own. In order to take on an assumable mortgage, the buyer of a property has to usually meet certain requirements set by the lender, such as having a good credit history, enough income to make the payments, and a down payment. The buyer of a property must also receive permission from the lender to assume the mortgage, which is often done in the form of a new loan agreement. An assumable mortgage can also be beneficial for a home seller, as it makes it easier for the buyer to get financing and it may help the seller to get a higher sale price. On the other hand, the seller does have to surrender control of the loan to the new borrower, so it is important for the seller to find a borrower who is trustworthy and financially responsible.

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What is an assumable mortgage?

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