Glossary of Notary Public, Mortgage, Signing Agent, and Loan Signing Terms.
Phonetics: as·sum·ed mort·gage \ə-sōōmd'\ \mȯr-gij\
An Assumed Mortgage is one that was taken over by the buyer when their property was sold. The interest rate on the mortgage is often lower than what the current rate for a new mortgage would be making this type of loan popular. To be eligible for an assumed mortgage, the lender needs to approve the buyer. The assumed mortgage might not cover the entire amount needed for the new buyer to finance his purchase, so additional financing or down payment might be necessary. One unusual risk of this type of loan is that the seller could still be liable for the loan should the buyer default. The seller needs to sign a document that releases their liability at the time of the assumption.Thesaurus / Related Terms