Assumable Mortgages for Home Buyers Simplified
You’re ready to buy your perfect home, but what about the issues surrounding your assumable mortgage? Understanding the intricacies as a home buyer assuming a mortgage, including eligibility criteria and approval processes, can be confusing for anyone. Smarter home buying starts with you and Assumption Solutions.
Your Bottom Line to Better Understand the Assumable Mortgage Basics
Home buyers like you are fighting high mortgage rates by trying to lessen ownership costs. The current homeowner passes their mortgage loan to you (the buyer) for a mortgage rate lower than today’s current rate. In 2024, Colorado Springs ranked in the top 15 U.S. cities with these types of assumable mortgage listings:
Traditional or Conventional Assumable Mortgage
These conventional mortgages are generally offered by private lenders, like banks and credit unions; some still allow buyers to assume existing loan terms.
Federal Housing Authority Assumable Mortgage
FHA-insured loans may be assumable, subject to lender approval and eligibility criteria, and offer low down payments and flexible credit requirements.
Department of Veterans Affairs Assumable Mortgage
VA loans are assumable by qualified buyers, typically veterans, active-duty service members, and their eligible spouses, with no down payment possible.
U.S. Department of Agriculture Assumable Mortgage
USDA loans may also be assumable, providing favorable financing options for eligible homebuyers in rural and suburban Colorado Springs areas.
Surprising Assumable Mortgage Advantages to Save You a Fortune
Assuming your mortgage comes with some big advantages when you partner with Assumption Solutions. Your financial goals are met and aligned with your future plans with honest advice from real estate professionals. Some of the biggest benefits include:
Low Interest Rates
If your assumable mortgage has a lower interest rate than current market rates, you get reduced monthly payments and immediate savings on your monthly housing expenses.
No Closing Costs
Assuming a mortgage can bypass the need for a new loan origination process to move into your new home. So, there are no closing costs typically associated with obtaining a new mortgage.
Faster Closing Process
Forget about the lengthy process of underwriting and approval for a new mortgage. We help ensure your Colorado Springs assumable mortgage experience is more efficient and quick so you can start living your best life.
Flexible Financing Options
Assumable mortgages offer more flexible financing options, which can be advantageous for buyers who may not qualify for a new mortgage due to credit or income issues.
No Down Payment
Some assumable mortgages may allow buyers like you to take over the loan without requiring a down payment, making homeownership more accessible on limited funds.
More Stable Terms
Assuming a fixed-rate mortgage allows any home buyer to lock in a stable interest rate and payment schedule, providing predictability and peace of mind in a fluctuating market.
Five Steps to Your Affordable Assumable Mortgage
Relieve your uncertainties about buying a home and assuming a loan in Colorado Springs. Make this process enjoyable and build your new life in a house that’s destined to be yours. Follow these easy steps to success:
Step 1
Contract your home with an existing assumable mortgage. Most commonly, this home will have a guaranteed USDA, FHA, or VA assumable mortgage. An interest rate below current market interest rates is ideal, and we work hard for it.
Step 2
The Assumption Solutions team will determine if you meet standard mortgage loan assumption requirements. You’ll need to create your loan assumption file and upload the documents required for your pre-qualification and final approval.
Step 3
For a smooth process, the buyer and seller agree to partner with the Assumption Solutions team, providing all the documents necessary to process your assumable mortgage loan.
Step 4
Once the existing mortgage holder approves your mortgage assumption, the closing can finally begin between you and your seller. (A $750 buyer assistance fee will be collected. The first $50 is paid at engagement, and the remaining $700 is paid at the time of your approval.)
Step 5
Congrats — you’re now a homeowner! Enjoy the benefits of your assumed mortgage or VA-assumable mortgage with the lowest interest rate and monthly payment for your current market. (Let us know if your family or friends need help too!)
Assumable Home Loan Education
FAQs Home Buyers Need To Know
Are assumable mortgages common in the Colorado Springs area?
The number of assumable mortgage homes on the market in Colorado Springs varies from month to month or year to year. The area ranks highly among active listings in the United States, where an average of 0.4 percent of for-sale listings advertise assumable loans.
Many areas of the country with a high military presence often have more options to choose from. Since 2019, about 8 percent of home loans in the U.S. have been VA loans, with another 15 percent being FHA loans, equaling one in four mortgages being assumable government home loans.
What are the eligibility criteria for assuming a mortgage?
While eligibility can always change or vary depending on your specific terms, you’ll most likely have to provide information related to your credit score, income, employment history, and debt-to-income ratios. You’ll need approval from the lender holding the assumable mortgage, along with signing an assumption agreement with whoever is selling the home you want.
Have Assumption Solutions on your side to ensure you comply with the existing mortgage terms and conditions. You’ll have someone on your side to explain the details of your eligibility criteria to avoid confusion.
What are the potential risks involved in assuming a mortgage?
There are potential risks to any decision in life. You need to understand and mitigate issues through due diligence and speaking with Assumption Solutions. You’ll want to avoid missing the remaining liability with the original borrower for the mortgage.
It’s essential to be aware of any decreases in your dream property’s value after your mortgage is assumed. Protect your rights and ensure the seller’s financial situation is on good terms. Talk to us about market conditions, where economic fluctuations or interest rate changes can impact your assumable mortgage affordability or flexibility.
Is there a fee associated with assuming a mortgage?
The short answer is: Yes. There will be fees associated with assuming a mortgage that will look different for every individual home buyer. You’ll need to look at your mortgage’s specific terms, the lender’s policies, and what state or local regulations could impact your purchase.
Assumption Solutions will make it easier for you to understand how much fees will be and why they’re necessary. Once your mortgage loan assumption is approved, closing will begin. We’ll collect our affordable buyer assistance fee of $750. ($50 is due at our first meeting, with the remaining $700 due after approval.)
How can Assumption Solutions assist me in navigating this process?
Don’t go through this alone! With our expert guidance and advice, you can move into your dream home faster and with more confidence. Assumption Solutions will help you determine eligibility, what assumable mortgages are available, negotiation assistance, and coordination with real estate agents, attorneys, and lenders for a streamlined process free from issues. We’ll go over potential risks throughout your transaction. When all the paperwork is signed, we’ll work with you to ensure your smooth transition into home ownership.
Do you only do assumable mortgages for home buyers in Colorado Springs?
No — we proudly serve all 50 states! No matter if you’re in Colorado Springs, New York City, or Columbus, Assumption Solutions can help you with your assumable loan transfer.