A transaction where either the borrower or / lender
assigns an existing mortgage (bank loan to purchase a residential property )
from the current holder to another person or / entity. Houseowners who are
unable to keep current on their mortgage payments may seek a transfer so that
they do not default and go into foreclosure.
Not all mortgages are eligible for transfer. In order to
transfer a mortgage, the lender will need to verify that the person or entity
that will assume the mortgage has adequate income and credit history to be able
to make payments in a timely manner.
Investopedia Says..!
Investopedia explains: Transfer of Mortgage
If you are not allowed to transfer a mortgage, due to the
loan's underwriting, you may need to explore other options to avoid
foreclosure.
For example, you could work with your lender to see if it
is possible to add another borrower / or owner to the mortgage which would
enable him / or her to make payments toward the unpaid loan balance. Or you
could sell the house and have a potential buyer, colleague, family member or /
another entity agree to make up any difference between the house's sale price
& the unpaid loan balance.
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