Posted on: 12th Nov, 2005 11:33am
Simple assumption is a process by which a buyer assumes or takes over the seller's mortgage obligation. But this doesn't mean that the seller is release from the liability. That's the reason, simple assumption is also known as transfer with no release of liability.
When you assume a loan and default, the original seller is secondarily responsible for paying off the unpaid balance. And the lender cannot seek a deficiency judgment against the original borrower if he fails to recover the unpaid debt by selling the home.
If you assume your parents' loan, they are not completely released from the liability and hence the loan payments will be reflected in their credit reports and not yours. However, if you default, then your parents' credit report will reflect an outstanding mortgage and it will be difficult for them to seek any other loan.
When you assume a loan and default, the original seller is secondarily responsible for paying off the unpaid balance. And the lender cannot seek a deficiency judgment against the original borrower if he fails to recover the unpaid debt by selling the home.
If you assume your parents' loan, they are not completely released from the liability and hence the loan payments will be reflected in their credit reports and not yours. However, if you default, then your parents' credit report will reflect an outstanding mortgage and it will be difficult for them to seek any other loan.
yes, can u tell me more about simple assumptions and what does it mean transfer with no release of liability? my parents made a mortgage for me to buy a home 4 years ago. i paid the notes. they have passed away and the property and double wide home was willed to me. we done a assumption of the loan with our morgage comp. and lawyer 4 months ago. my main concern right now someone told me that this will not go on my credit. the loan co. says it is only in my name that my parents names have been removed. can you tell me anything about this.I am tring to rebuild my credit and i feel having a mortgage and keeping the payments up will help improve it. is there something i can do? any information would be helful. thank you
Who should claim the intrested payed on the mortgage loan if the morgage was assumed and the deed was transfered into the person assumings name?
Hey Holly,
As far as I know, the person who pays the mortgage dues can claim the interest. In your case, I guess, the person who has assumed the mortgage will be paying the mortgage dues. So he/she will be able to claim the interest.
As far as I know, the person who pays the mortgage dues can claim the interest. In your case, I guess, the person who has assumed the mortgage will be paying the mortgage dues. So he/she will be able to claim the interest.
Hello.
If I complete a simple assumption to put my sons on my 2 homes, does that
insure they get the properties when I die?
If I complete a simple assumption to put my sons on my 2 homes, does that
insure they get the properties when I die?
Hi Maria Herndon
Putting your sons name on the mortgage will not ensure that they get the property. Your sons should have their name on the property deed as well. Moreover, you can leave them a will which states who will get the property after your death.
Thanks.
Putting your sons name on the mortgage will not ensure that they get the property. Your sons should have their name on the property deed as well. Moreover, you can leave them a will which states who will get the property after your death.
Thanks.
My uncle sold me a town home over a year ago. Since that time, we have found out that our family is growing and we need more room. We found a home for an excpetional price and are trying to jump on it. We don't think we have time to list our home or the extra money to pay realtor fees.
The home we are looking at is a private sale and the man selling it is selling it for way under market value. We need to get what we paid for home (or close to it) to ensure we have enough to pay the 5% difference in our portable mortgage.
My uncle says he will buy the place back from us but, since he is currently building his dream home, he would have to assume the mortgage, paying us the money we put into it of course.
If our lender approves his assumption of the mortgage are we then able to get another mortgage (we qualify) or are we responsible for the assumable for a one year period. If we are responsible, can we still get a new mortgage or do we have to wait for the entire year?
If we do have to wait then our plan is no good to us anyway.
The home we are looking at is a private sale and the man selling it is selling it for way under market value. We need to get what we paid for home (or close to it) to ensure we have enough to pay the 5% difference in our portable mortgage.
My uncle says he will buy the place back from us but, since he is currently building his dream home, he would have to assume the mortgage, paying us the money we put into it of course.
If our lender approves his assumption of the mortgage are we then able to get another mortgage (we qualify) or are we responsible for the assumable for a one year period. If we are responsible, can we still get a new mortgage or do we have to wait for the entire year?
If we do have to wait then our plan is no good to us anyway.
If you already have a loan in your name, then there are chances that the lender may not give you another loan. However, if your credit is good and if you can show that you have consistently paid the mortgage then the lender may be ready to give you a loan. In order to show that you have consistently paid the mortgage dues, you will have to pay the mortgage for at least a year. So I guess you will have to wait.
I paid 908 dollars to assume a home loan from my previous wife.
Is the assumption cost tax deductible? If so, wher do you enter it?
Is the assumption cost tax deductible? If so, wher do you enter it?
I don't think that the assumption costs are tax deductible. You can contact a tax adviser and get his opinion on this issue.
joseph, you didn't state to whom you paid this $908; but in all likelihood, you'll not be able to claim a deduction for that amount. as the guest above noted, you'll want to get the advice of a tax advisor.
What I am trying to do is to put my sister in law's name on my mother in law's house so that if my mother in law dies my sister in law will be able to keep the house since my mother in law has no will or trust. So my question is, what is the simplest way to do this?
trisha, you'd want to use a quit claim deed. however, why doesn't your mother in law have a will? it would be a wonderful idea to ensure that she draws up a will. i'm sure you can find a competent attorney for a fair price to do that. i'm not discounting the idea of adding your sister in law to the title of the home, but simply pointing out the value of having a will.
If I use a quit claim, does this take my mother in law's name off the property and just leave my sister in law as owner and does she assume the mortgage? If she draws up a will, does my sister in law assume the mortgage at the time of my mother in laws death?
with a quit claim, mom would be able to set up ownership in one of two ways: joint ownership with her and her daughter; or individual ownership with the daughter only. now, i suspect that's not in her best interests, so i'd think the former (joint ownership) is the way to go. upon death, if the mortgage still exists, in my opinion the daughter would simply need to continue payments until such time as the loan is paid off. assuming the mortgage is time-consuming and not necessarily needed. of course, that depends on who the lender is and how much they will find out about your mother in law's passing - if that should happen prior to the mortgage being paid off.
a will would take care of all that she has (presumably); i.e. personal property, cash, etc.
a will would take care of all that she has (presumably); i.e. personal property, cash, etc.
George,
Thank you so much for your help. You have been very informative. I appreciate it.
Have a good day,
Trisha
Thank you so much for your help. You have been very informative. I appreciate it.
Have a good day,
Trisha
it's my pleasure, trisha - hope you have a delightful day as well.