What Is an Assumable Mortgage
- By Jim Blackburn
- on
- 100 first time home buyer FAQs
1. An Assumable Mortgage Allows You to Take Over the Seller’s Loan
With an assumable mortgage, instead of applying for a new mortgage, you can take over the seller’s existing mortgage—including the interest rate and remaining balance.
This means you’ll pick up where the seller left off, keeping their favorable loan terms.
If the seller has a lower interest rate than current market rates, you could save a lot of money over the life of the loan.
It’s like inheriting the seller’s mortgage—but only if the loan allows it
2. It’s a Great Deal if the Interest Rate Is Lower Than Current Rates
One of the biggest advantages of an assumable mortgage is the potential for lower interest rates.
If the seller’s loan was secured when interest rates were lower, you’ll benefit by keeping that lower rate instead of taking on a new, higher-rate loan.
This can save you thousands of dollars over the course of your mortgage—making it an attractive option, especially in high-rate environments.
Check the numbers, and if the interest rate works in your favor, it could be a big win
3. Not All Mortgages Are Assumable
While some loans are assumable, not all are—so you’ll need to check with the lender.
FHA and VA loans are commonly assumable, but conventional loans often are not.
Make sure you confirm with the lender whether the seller’s mortgage is assumable and if you meet the criteria.
It’s important to verify the specifics before you make any decision
Thinking About an Assumable Mortgage? Let’s See If It’s Right for You
Download our free “Assumable Mortgage Guide” — includes pros, cons, and how to determine if it’s a good fit for your financial goals Chat live now if you have questions about assumable mortgages or want to know if one’s available for your dream home
Schedule a call with a Stairway Mortgage advisor to explore your mortgage options and how to make an assumable mortgage work for you
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