An assumable Mortgage is a feature that enables homebuyers to take on the loan previously obtained by the seller.
The catch here is that the buyer has to pay interest at the same rate as the seller. In addition, this feature is limited to mortgages covered by the Department of Veterans Affairs (VA) or the Federal Housing Administration (FHA).
If you have a loan insured by either of these government bodies and are looking to sell your home, now is the time to market the mortgage along with the house.
With interest rates increasing, this is a convenient option for potential homebuyers in Sunny Isles Beach since the seller may have obtained the mortgage at a rate lower than the prevailing one in the market today.
Aside from the cheaper mortgage payment, there are a few other benefits of an assumable home loan for the buyers:
- The buyer doesn't have to pay lenders' additional processing fees when originating a new home loan. As a result, many charges and expenses are associated with getting a new mortgage that is entirely avoided.
- The buyer doesn't have to get the house appraised (and pay for this expense). Many buyers may still bear this expense voluntarily, but it's not a requirement when taking advantage of an assumable loan.
- A recording tax may not have to be paid. For example, a recording tax is usually paid each time a property obtains a mortgage. However, since a new mortgage is not being originated, a new tax will likely be avoided.
- Since some part of the loan would have already been paid off by the seller, a more significant chunk of the mortgage payment likely pays off the principal amount.These are some benefits for homebuyers to assume home loans when buying a new home in Sunny Isles. However, this may not be the best option for all buyers.Buyers also still have to undergo the standard screening process for creditworthiness by the VA or FHA. Finally, the buyer has to waive the seller of all future responsibilities and obligations about the loan.An assumable home loan is an excellent option for buyers in a market where interest rates rise. Interested in learning more about how you can take advantage of this? Give me a call, and I'd be happy to discuss it.
- For instance, if you are looking to buy a home for the first time, you might not be able to get 100% financing.
- The house's value is $150,000, while the seller owes $100,000. Therefore, you will have to make up the difference of $50,000 by paying cash or by negotiating with the seller for seller financing.
- Gladis Henriquez | Realtor | 305-281-8653 – https://www.sunnyislescondosre.com – Optimar International Realty – Sunny Isles Beach, FL 33160.
