Legal Question in Real Estate Law in California

Assume a Mortgage Loan

A couple no longer wants their home and is looking for someone interested in assuming their loan. I'm interested is it possible and how I don't want to get hurt

Asked on 7/25/07, 2:37 pm

1 Answer from Attorneys

Judith Deming Deming & Associates

Re: Assume a Mortgage Loan

An "assumption" can only be done by entering into an agreement with the lender, who may or may not be interested in accepting someone else on the loan, and they often charge an assumption fee. Many people who try to assume cannot, and then they agree to simply take over payments on the loan (without an ssumption)and then the owners/borrowers deed the house to the person interested in taking over. This is fraught with problems; aside from the fact that the lender could "call the loan" if they wanted, usually when people want someone to take over their payments, it is because they can't afford to make the payments themselves and are behind and close to foreclosure and then afterwards, the person taking over finds out they are days away from foreclosure. Also, if they are behind on their payments on the property, they often also have judgment liens, tax liens, etc. which have attached to the property and when you take over, they come WITH the property and can be enforced against the property. Whatever you do, get a title report and go through an escrow, and remember if it looks too good to be true...

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Answered on 7/25/07, 3:33 pm

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