Assumable loans let buyers take over a seller’s mortgage and help sellers draw in stronger offers.
Home prices aren’t the only thing making buyers nervous; interest rates are, too. In Portland, many people who hoped to buy a home are now wondering if they can afford it at all. Monthly payments have jumped, and the low rates we saw a few years ago feel like a distant memory.
But there’s one option that most people don’t know about, and it could make a big difference for both buyers and sellers: assumable loans.
An assumable loan allows a qualified buyer to take over the seller’s existing mortgage, including its interest rate and terms. That means if a seller has a loan with a rate that’s half of today’s market average, the buyer could potentially assume that loan and enjoy a much lower monthly payment.
A powerful tool for sellers. If you’re selling a home and have an assumable loan, you may attract buyers who are specifically looking for a financial edge. A lower interest rate can make your listing stand out and bring in a stronger buyer base.
Assumable loans sound great in theory, but they’re not simple. A lot needs to happen for the deal to work:
• The buyer must qualify for the loan under the bank’s terms.
• The bank must approve the assumption, which can take time.
• The loan balance must align with the buyer’s financing plan.
For example, let’s say a home is listed at $500,000. A buyer planning to put 20% down would typically need a $400,000 loan. But if the seller’s assumable loan balance is only $200,000, the buyer must find a way to cover the remaining $200,000 either through a larger down payment or other financing. That’s a big hurdle, and it’s one reason assumable loans don’t always work out.
Work with your trusted agent. Despite the complexity, assumable loans can be worth the effort. If the numbers line up and the buyer qualifies, the savings can be substantial. And for sellers, offering an assumable loan could be the key to attracting more interest and helping you move on to your next home.
This is where working with the right agent makes all the difference. You need someone who’s not afraid of hard work, who’s willing to dig into the details, and who can help both buyer and seller navigate the process. It takes time, diligence, and a commitment to finding solutions that work for everyone.
If you’re curious about assumable loans or selling with one? Let’s talk about how to turn this feature into your advantage. For details on this and other seller incentives, contact me at (503) 522-0090, sarita@asksarita.com, or visit AskSarita.com. It may take more time, but I’m here to help you make it work.
