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 Virginia General Form of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust is a legal contract commonly used in the state of Virginia for the sale and purchase of residential properties. It facilitates the transfer of property ownership and outlines the terms and conditions agreed upon by the buyer and seller. In this agreement, the buyer assumes the existing mortgage or deed of trust on the property, relieving the seller of their mortgage obligations. By assuming the mortgage or deed of trust, the buyer agrees to make regular payments to the lender as per the original terms and conditions of the loan. This legal document contains several important sections, including: 1. Property Details: The agreement starts by providing a detailed description of the residential property being sold. This includes the property's address, legal description, and parcel identification number. 2. Purchase Price and Payment Terms: The agreement specifies the total purchase price of the property and outlines the agreed-upon payment terms, such as the down payment amount, installment amounts, and the due date for each payment. 3. Assumption of Mortgage or Deed of Trust: This section clarifies that the buyer assumes the existing mortgage or deed of trust, including any outstanding balance, interest rate, and payment schedule. It also states that the buyer agrees to comply with all terms and conditions of the original mortgage or deed of trust. 4. Seller's Representations and Warranties: This section ensures that the seller provides accurate and truthful information about the property, such as its current condition, any known defects or liens, and any pending legal or environmental issues. 5. Deposit and Escrow: The agreement outlines the amount of the buyer's deposit, who will hold it in escrow, and the conditions under which it will be released. 6. Closing and Settlement: This section describes the process and timeline for the closing of the sale, including the responsibilities of each party, the necessary documents, and the distribution of funds. Types of Virginia General Forms of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust may include variations designed specifically for different types of residential properties, such as single-family homes, townhouses, condominiums, or co-operative units. Each form may have specific clauses tailored to address the unique considerations and regulations associated with these property types. In conclusion, the Virginia General Form of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust is a legally binding contract that facilitates the sale and purchase of residential properties in Virginia. It establishes the terms and conditions agreed upon by the buyer and seller, including the assumption of any existing mortgage or deed of trust on the property.The Virginia General Form of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust is a legal contract commonly used in the state of Virginia for the sale and purchase of residential properties. It facilitates the transfer of property ownership and outlines the terms and conditions agreed upon by the buyer and seller. In this agreement, the buyer assumes the existing mortgage or deed of trust on the property, relieving the seller of their mortgage obligations. By assuming the mortgage or deed of trust, the buyer agrees to make regular payments to the lender as per the original terms and conditions of the loan. This legal document contains several important sections, including: 1. Property Details: The agreement starts by providing a detailed description of the residential property being sold. This includes the property's address, legal description, and parcel identification number. 2. Purchase Price and Payment Terms: The agreement specifies the total purchase price of the property and outlines the agreed-upon payment terms, such as the down payment amount, installment amounts, and the due date for each payment. 3. Assumption of Mortgage or Deed of Trust: This section clarifies that the buyer assumes the existing mortgage or deed of trust, including any outstanding balance, interest rate, and payment schedule. It also states that the buyer agrees to comply with all terms and conditions of the original mortgage or deed of trust. 4. Seller's Representations and Warranties: This section ensures that the seller provides accurate and truthful information about the property, such as its current condition, any known defects or liens, and any pending legal or environmental issues. 5. Deposit and Escrow: The agreement outlines the amount of the buyer's deposit, who will hold it in escrow, and the conditions under which it will be released. 6. Closing and Settlement: This section describes the process and timeline for the closing of the sale, including the responsibilities of each party, the necessary documents, and the distribution of funds. Types of Virginia General Forms of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust may include variations designed specifically for different types of residential properties, such as single-family homes, townhouses, condominiums, or co-operative units. Each form may have specific clauses tailored to address the unique considerations and regulations associated with these property types. In conclusion, the Virginia General Form of Agreement of Sale of Residential Property with Assumption of Existing Mortgage or Deed of Trust is a legally binding contract that facilitates the sale and purchase of residential properties in Virginia. It establishes the terms and conditions agreed upon by the buyer and seller, including the assumption of any existing mortgage or deed of trust on the property.
