WARNING: Not all mortgages are assumable.
WARNING: Most mortgages are likely not assumable.
WARNING: Many mortgages contain "due on sale" clauses that prevent assumption and can make the entire mortgage due and payable at closing. This could be financially harmful to a party or parties if this occurs. Financial harm can lead to you being sued, facing ethics complaints, facing license law complaints, upset people, loss of future business/referrals, and/or bad reviews.
ALWAYS: verbally and good practice is a follow up email documentation that you recommend all the parties obtain legal counsel ASAP prior to signing any legal documents (this is also in many SCR forms) and this is especially critical if a party or parties are desiring an assumable mortgage in their deal.
Assumable mortgages might be desirable when the current mortgage has a low interest rate compared to the market rates. So, you may encounter more consumers interested in assumable mortgages. An assumable mortgage might be a strong marketing advantage for those sellers who have an assumable mortgage. Sellers should obtain legal counsel asap to determine if their mortgage is assumable.
Posted by: Byron King on 02/23/24 (This information is only accurate as of 02/23/24. You must contact SCR for updates and changes to this information after 02/23/24 as laws and regulations may change over time. SCR 803-772-5206 or email info at screaltors.org or email byron at screaltors.org)
This information is not legal advice. This information is intended only to provide general information and may not be relied upon as specific legal guidance. Legal counsel should always be consulted before acting in reliance on this information.