Assumable Mortgage Las Vegas Real Estate

Las Vegas Properties Currently For Sale With An Assumable Mortgage

OVERVIEW of ASSUMABLE MORTGAGES

Only about 6% of listings are eligible, and in most circumstances must either be an FHA, USDA, or VA loan.

The interested buyer has to meet the qualifying criteria of the original loan to assume the mortgage.

Market conditions don’t always make assuming a mortgage the right move. For instance, if a home’s value has significantly appreciated since the start of its mortgage, a buyer might owe the seller enough to cancel out the benefits of a lower rate.

PROS

- Get a lower rate

- Lower upfront costs

- Shorter loan life

- Long-term savings

CONS

- Very few qualify

- Lenders can be slow to act

- Buyers must use seller’s lender

- Buyer might need a second mortgage
to cover home’s increased value

FAQ

What types of loans are eligible for an assumable mortgage?

FHA, VA, and USDA loans are eligible for assumable mortgages.

FHA loans
The Federal Housing Administration grants these loans to low-income borrowers, and new borrowers must qualify under the same terms, including credit and employment standards.

USDA loans
The U.S. Department of Agriculture offers these loans to low-income borrowers in rural areas, and new borrowers must meet the same credit score and income criteria.

VA loans
These loans, which are offered to active or retired military, are unique because they can be assumed by non-veterans, but credit and income criteria will still apply. Another thing to note is that this VA benefit also stays with the loan, not the person. Therefore, the seller or owner of the VA loan could find it difficult to take out another VA loan.

How does the down payment differ from a traditional mortgage?

The buyer has to make up the difference between the current balance on the mortgage and the current value of the home. For example, if the seller has a $300k mortgage, and the house is valued at $500k. The buyer needs to have $200k to put down or take out a second loan to cover the difference (at current interest rates).

What's in it for buyers?

A lower interest rate
Today, with rates hovering around 7%, assuming a mortgage can make a big difference in monthly payment amount.

Fewer upfront costs
Since you would be assuming a mortgage-in-progress, the costs of starting a new loan (for example, upfront mortgage insurance costs) aren’t a factor.

A shorter loan life
As the buyer, you’ll only be responsible for the remaining years of the loan. So, if the seller is eight years into a 20-year mortgage, you’ll only have the remaining 12 years to pay off.

Long-term savings
Get a more detailed rundown of your potential savings with ouronline mortgage calculator.

What's in it for sellers?

If you bought your home at a substantially lower rate than is currently available, offering an assumable mortgage can really sweeten the deal for prospective buyers, helping you close faster if that’s a priority.

Any other watchouts?

Yes. Even if everything else lines up, another thing to consider is responsibility. The original mortgage holder can be held liable if the assuming party defaults.

Properties Currently For Sale With A Assumable Mortgage