A buyer and a seller agree to an assumption when the buyer takes over the seller's payments on an existing mortgage. Since the buyer is taking over an existing mortgage, they usually save money. With a new mortgage, the buyer will have to pay closing costs and a new, probably higher, market rate of interest.
This type of mortgage might be a good fit for someone who wants to save money on closing costs and assumes that the interest rate will be low.
A part of the mortgage has already been paid by the seller, which is another benefit of taking over a mortgage. Also, it's likely that the house has gone up in value since the seller bought it, so the mortgage you take on will be less than what the house is worth.
Taking over a mortgage loan can be tricky, and you still have to fill out all the paperwork that comes with a regular mortgage. So make sure you talk to the right people, like a real estate attorney or realtor, who can point you in the right direction.
The money saved on closing costs is without a doubt the best thing about an assumption. So, if this sounds like a good fit for you, it is worth your time to learn more about it.
