An assumable mortgage is one which lets a buyer take over the existing loan of a seller. Assumable mortgages require the lender's approval. The person who assumes a mortgage takes the same interest rate and monthly payment schedule as the original loan, which can result in big savings if the interest rate on the existing mortgage is lower than the current rate on new loans. However, the lender can change the loans terms. The person assuming a mortgage still needs to qualify for the loan and pay closing fees, including the costs of the appraisal and title insurance.
The lender also holds the seller liable for the loan. For example, if the person assuming the mortgage defaults on payments and the lender forecloses, but the property sells for less than the loan's balance, the lender can sue the seller for the difference.
The District of Columbia General Form of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust is a legally binding document used in real estate transactions to outline the terms and conditions for the sale of residential property in the District of Columbia where the buyer assumes an existing mortgage or deed of trust. This agreement is designed to protect the rights and interests of both the buyer and the seller by laying out the specific terms of the sale, including the purchase price, down payment amount, and any contingencies or conditions that need to be met before the sale is finalized. It also addresses the assumption of the existing mortgage or deed of trust and outlines the responsibilities of both parties in relation to the mortgage or deed of trust. The District of Columbia General Form of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust encompasses various situations and may be modified to suit the specific needs of the buyer and seller. Some different types of this agreement may include: 1. Agreement with Fixed Rate Mortgage Assumption: This type of agreement is used when the buyer agrees to assume an existing mortgage with a fixed interest rate. The agreement will outline the terms of the assumed mortgage, including the interest rate, loan term, and monthly payment amount. 2. Agreement with Adjustable Rate Mortgage Assumption: In this case, the buyer assumes an existing mortgage with an adjustable interest rate. The agreement will detail the terms of the assumed mortgage, including the adjustment period, rate caps, and any potential changes to the monthly payment amount. 3. Agreement with Deed of Trust Assumption: This type of agreement applies when the buyer assumes an existing deed of trust instead of a mortgage. A deed of trust is a legal document that secures a loan with the property as collateral, similar to a mortgage. The agreement will outline the terms of the assumed deed of trust, including any specific conditions or requirements. 4. Agreement with Contingencies: This type of agreement includes additional contingencies regarding the assumption of the existing mortgage or deed of trust. It may specify conditions that must be satisfied, such as the buyer obtaining lender approval for assumption or the seller providing specific documents related to the mortgage or deed of trust. It is important to consult with a qualified attorney or real estate professional for guidance when using or drafting a District of Columbia General Form of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust, in order to ensure that all legal requirements and the specific needs of the parties involved are properly addressed.The District of Columbia General Form of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust is a legally binding document used in real estate transactions to outline the terms and conditions for the sale of residential property in the District of Columbia where the buyer assumes an existing mortgage or deed of trust. This agreement is designed to protect the rights and interests of both the buyer and the seller by laying out the specific terms of the sale, including the purchase price, down payment amount, and any contingencies or conditions that need to be met before the sale is finalized. It also addresses the assumption of the existing mortgage or deed of trust and outlines the responsibilities of both parties in relation to the mortgage or deed of trust. The District of Columbia General Form of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust encompasses various situations and may be modified to suit the specific needs of the buyer and seller. Some different types of this agreement may include: 1. Agreement with Fixed Rate Mortgage Assumption: This type of agreement is used when the buyer agrees to assume an existing mortgage with a fixed interest rate. The agreement will outline the terms of the assumed mortgage, including the interest rate, loan term, and monthly payment amount. 2. Agreement with Adjustable Rate Mortgage Assumption: In this case, the buyer assumes an existing mortgage with an adjustable interest rate. The agreement will detail the terms of the assumed mortgage, including the adjustment period, rate caps, and any potential changes to the monthly payment amount. 3. Agreement with Deed of Trust Assumption: This type of agreement applies when the buyer assumes an existing deed of trust instead of a mortgage. A deed of trust is a legal document that secures a loan with the property as collateral, similar to a mortgage. The agreement will outline the terms of the assumed deed of trust, including any specific conditions or requirements. 4. Agreement with Contingencies: This type of agreement includes additional contingencies regarding the assumption of the existing mortgage or deed of trust. It may specify conditions that must be satisfied, such as the buyer obtaining lender approval for assumption or the seller providing specific documents related to the mortgage or deed of trust. It is important to consult with a qualified attorney or real estate professional for guidance when using or drafting a District of Columbia General Form of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust, in order to ensure that all legal requirements and the specific needs of the parties involved are properly addressed.
