Assumable loans with qualifying - Posted by Darrell

Posted by Darrell on April 22, 2006 at 21:23:06:

I agree, sub2 is the way to go. If the seller refused a sub2 and the current loan’s interest rate was attractive, it may be worth assuming if the numbers worked. Thanks

Assumable loans with qualifying - Posted by Darrell

Posted by Darrell on April 22, 2006 at 17:14:14:

According to a book I am reading, “106 Mortgage Secrets all Homebuyers must Learn”, it says, on page 60, “…generally, sellers who have financed their properties with FHA, VA or most types of adjustable rate mortgages can offer an assumption to their buyers.” It goes on to say, “True, buyers do have to qualify to assume these loans.”

I am attempting to verify this information. Is anyone assuming any of these loans with qualifying? Or,is the book incorrect? Thanks

assumption vs. subject to - Posted by John Merchant

Posted by John Merchant on April 25, 2006 at 24:12:31:

When I was younger I thought that a seller would be crazy to sell on anything like “subject to” as he’d have no control over the property and not know if the buyer was paying or not.

It was my thought that making the buyer qualify and assume was a panacea…solved all the problems.

Then I was stung badly when one of my buyers DID assume, and I assumed, mistakenly, that I’d really made a killer deal.

The once good buyer got in marital trouble and lost about a dozen properties, including mine.

I was just extremely fortunate that the bank, instead of coming after me, elected to foreclose…and then, pursuant to our state’s laws, could not sue me for a deficiency.

But the upshot was that I lost the profit from selling on an assumption.

So just remember they’re really not much safer than subject to…and if selling, and having the buyer pay YOU, then your paying the bank, you know, month by month, whether the buyer is paying or not.

And please remember that just because B assumes A’s loan, A is NOT released thereby and A is still on that loan.

Re: Assumable loans with qualifying - Posted by John

Posted by John on April 22, 2006 at 20:58:54:

I have heard it is true. In fact a friend assumed a FHA mortgage on a property he bought.
My question would be why would you assume a mortgage when you could buy sub2?