What is an Assumable Mortgage

If you’re a real estate agent, you may have been hearing a lot about assumable mortgages lately. They can be a great option for buyers, so it’s important to understand what they are and how they work. In this blog post, we’ll explain what assumable mortgages are, and discuss the pros and cons of taking one on. We’ll also provide some tips on how to determine if an assumable mortgage is right for your buyer and seller. So, if you’re curious about assumable mortgages, read on!

What is it?

An assumable mortgage is a type of loan that can be transferred from the seller to the buyer of a home. This type of mortgage typically has a lower interest rate than what is available on the open market, making it an attractive option for home buyers. In order to assume a mortgage, the buyer must first be approved by the lender. The buyer then takes over the payments on the loan, including any remaining balance, as well as the interest rate and terms of the loan. Assumable mortgages can be a helpful tool for buyers looking to purchase a home, but it is important to understand the risks involved before assuming any loan.

What’s in it for a Seller?

One reason a seller might be willing to allow a buyer to assume their mortgage is that it could make the home more attractive to potential buyers. An assumable mortgage usually comes with a lower interest rate than what is available on the open market, making it an appealing option for borrowers. However, assumable mortgages can can come with risks to the seller. The lender might continue to hold the seller liable for any missed payments for a period of time after the sale to the new buyer, generally a three year period.  

Get and read the fine print

It’s always best to have your seller contact their lender prior to any offering of an assumable mortgage. Even though many loans are assumable, not all are. Verifying first what the conditions, restrictions and requirements are can provide the information necessary to the seller to enable them to make a sound decision.  


Assumable mortgages might not be best for everyone, but in the environment of rising interest rates, those 2.5% rates of a few years ago can be very enticing and may enable the buyer to pay a higher price for the property due to the lower payment they will receive. Have you ever sold a property through an assumable mortgage? If so, how long ago was it? Let me know in the comments section below!

If you are still looking for more of the nitty gritty of assumable mortgages, you might be interested in my online course. You can check it out here.

You may find it interesting to read How to Stop Sellers from Overpricing. With the market changing, we need to keep sellers educated every step of the way.

If you’re ready to take your real estate career to the next level, but don’t know where to start or have a solid plan in place for your business, you might want to check out my 90 days to Success Coaching Series.

If you’re looking for more ideas to implement into your real estate business to achieve success, be sure to read The Standout Agent, available on Amazon and everywhere books are sold. There’s a reason why it quickly became a #1 seller!

Looking for More Tips?

Be sure to sign up for more tips on my website. Want to read more articles like this one? To ensure you don’t miss them, sign up here.

1 thought on “<strong>What is an Assumable Mortgage</strong>”

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Scroll to Top