Dictionary of Business Terms: assumable loan
assumable loan
a mortgage loan that allows a new home purchaser to undertake the obligation of the existing loan with no change in loan terms. Loans without due-on-sale clause, including most FHA and VA mortgages, are generally assumable.
Dictionary of Real Estate Terms: assumable loan
assumable loan
a mortgage loan that allows a new home purchaser to undertake the obligation of the loan with no change in loan terms. This is generally true of loans without due-on-sale clause. Most FHA and VA mortgages are assumable.
Example: Abel sells a home with an assumable loan to Baker. Baker takes over the payments of the loan and accepts liability under the mortgage note.
