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Assumable Without Qualifying Mortgages Are Rare , So Be Careful!
by: Lanard

Start by being careful! Too many real estate deals gone bad started out between friends, or family members.

The first thing you need to do is contact your lender and find out if your loan is assumable. If it is find out if it's assumable with or without qualifying.

If it is assumable with qualifying it means that your friend needs to be approved by your lender to assume the loan and if he/she doesn't qualify you can't let your friend assume the loan - period!

On the other hand if your mortgage lender tells you that your loan is assumable without qualifying you're ready to get the paperwork in order, starting with a contract for sale.

This is where you start spending money. However, if your friend is assuming the mortgage with little money involved I'd have him, or her, pay all of he related costs.

It's hard to say what the going rate for something like this is in your community, but you may be able to get someone to draw up a contract for a couple of hundred dollars. Once you have that in hand you can find your way to a Title Insurance Company and have them close the deal for you.

Or you can ask a Real Estate Attorney to handle the transaction for you. Be sure to call around and get several quotes in order to get the best deal.

Do not under any circumstances try to do it yourself, or let your friend do it. You have too much at risk to botch things up. If not done right you'll still be on the hook for the loan, even if your friend is living in it.

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