When assuming a mortgage, the seller will agree to let the potential buyer take over his or her mortgage payments at the same interest rate level that they may have had since the house was first purchased. The buyer is essentially assuming the existing mortgage, which in many cases can work out well for both the home seller and the purchaser.

A mortgage assumption is a contractual agreement wherein a home purchaser assumes the sum total of a seller’s requirements on his mortgage, including the full balance, the repayment of same, the length of the mortgage and the rate of interest. Such an assumption is not at all the same as purchasing a home subject to the mortgage. The approval of the current lender is always necessary when entering into a mortgage assumption. This is due to the fact that you are taking over the liability from the present homeowner. Since the buyer is receiving great benefit from the mortgage assumption, he must understand that the seller should receive some advantage as well. In general, the advantage to the seller will materialize in a greater price for the house. Read the rest of this entry »

Mortgage demand dips on rising rates
NEW YORK (Reuters) – U.S. home loan demand cooled last week as rising mortgage rates curbed refinancing requests that had soared to a 14-month high, the Mortgage Bankers Association said on Wednesday.

Rail Life

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First home loan applications on the rise
MORTGAGE applications by first home owners rose 2.3 per cent in the June quarter, but credit card applications fell nine per cent, credit agency says.

Christopher S. Penn

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