How does a loan assumption work?

Answer by  BlindMag (161)

Your best bet would be to contact your mortgage holder and a lawyer that specializes in the process. They should be able to guide you through the process with ease.

Answer by  tamarawilhite (17883)

You must get the permission of the current loan holder to allow this. Then the loan holder will change the loan paperwork to replace the individuals who owe the money.

Answer by  eldergeek (473)

This must be handled through, and supervised by, the lending institution. The party who is assuming the loan may be required to pass muster with the lender although FHA loans can be assumed without qualification requirements.

Answer by  DesertRat (699)

There are two main steps. First, the buyer has to agree to assuming the loan. Second, the lender has to approve the buyer. That means the buyer must go through all the same steps as if he were applying for a new loan, because as far as the lender is concerned that's essentially what's happening.