Can you sell your home if you have a VA Mortgage?
Eventually, most people will sell their homes. To increase their home's appeal, some sellers will offer the buyer the option to assume their current mortgage. When a buyer takes over the current mortgage from the seller of the property rather than obtaining a new loan, the buyer is said to have assumed the mortgage. This is an attractive option to buyers who may have credit issues that would prevent them from purchasing a home or obtaining an affordable mortgage.
To assume a mortgage:
- If you are the seller and you would like to allow the buyer to assume your mortgage, you should inform your real estate agent and/or include this information in your advertisement.
- If you are a buyer who would like to assume a mortgage, you may search specifically for sellers who offer this option, or you may ask a seller if he or she will allow you to assume their mortgage.
- Obtain a copy of the loan papers. If you are the seller you will need to provide potential buyers with the terms of the loan. If you are the buyer you will want to know the terms of the loan before you decide whether or not to assume the mortgage.
- You may obtain an assumption package from the current lender listed on the mortgage. The mortgage company will be able to provide buyers and sellers with the necessary information for the buyer to assume the mortgage.
- as a buyer, you should calculate the difference between the amount of the mortgage you plan to assume and the purchase price of the home. It may be necessary to obtain another loan to pay the seller the difference.
- Buyers should always compare the terms a lender could offer them on a new loan with the terms of the seller's loan they wish to assume to see which would suit their needs best.
- Find your loan today!
It is important to be in contact with your mortgage company and stay informed by asking questions to better understand the loan process. It is also important to remember that if you are the seller and you allow a buyer to assume your current mortgage, and that mortgage was obtained through the VA Home Loan Guarantee Program, then your entitlement will be associated with that mortgage unless you release your liability from the mortgage. For more information on how to assume a mortgage and the VA Home Loan Guarantee Program, contact your lender or your local VA Regional Loan Service Center.