Definition of assumption of mortgage

taking upon oneself the obligations of a mortgagor toward a mortgagee, generally as part of the purchase price of a parcel of real estate. By assuming the mortgage rather than taking subject to the mortgage, the purchaser becomes personally liable on the debt. The seller is not relieved of the obligation unless the lender agrees to do so in a novation. Many lenders refuse to allow mortgage loans to be assumed unless they approve of the transaction; often they require points or increase the face rate of interest.