A mortgage that allows a new buyer to take over the seller's existing loan, inheriting the current interest rate, remaining balance, and terms. The buyer must qualify with the lender, but if approved, they step into the seller's shoes on the mortgage. Assumable mortgages are uncommon but can be valuable when the seller's rate is significantly lower than current market rates.
Why It Matters
In a rising-rate environment, an assumable mortgage with a low locked-in rate can be a major selling point. For buyers, it means potentially securing a rate well below what's currently available. These are rare in the GTA, but worth asking about -- especially on properties listed during periods of rising interest rates.
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