Transfer of mortgage,
Definition of Transfer of mortgage:
Transfer of mortgage is a transaction where either the borrower or lender assigns an existing mortgage (a loan to purchase a property—usually a residential one—using the property as collateral) from the current holder to another person or entity. Homeowners who are unable to keep current on their mortgage payments may seek a transfer so that they do not default and go into foreclosure.
A transaction where an existing mortgage is transferred from the current holder to another person or entity. For example, if a homeowner is at risk of foreclosure, or otherwise wishes to sell their property, it is possible to agree with a lender to assign the mortgage to a new owner, who will then be liable for payments.
A buyer may want to take on an older mortgage because such a transfer could let them take advantage of previous interest rates that may have been lower than the current market rates. A transfer of the mortgage, if completed successfully without challenge or stipulations, would not change the terms or length of the loan, leaving just the remaining outstanding balance to be paid off. Through a transfer of the mortgage, a buyer might also avoid having to pay closing costs that are associated with buying a home with a new mortgage.
How to use Transfer of mortgage in a sentence?
- Mortgage lenders often include a due on sale clause in their loans that prohibits a home seller transferring a mortgage to a buyer.
- Not all mortgages can be transferred; if they are, the lender has the right to approve the person assuming the loan.
- A transfer of mortgage is the reassignment of an existing mortgage, usually on a home, from the current holder to another person or entity.
Meaning of Transfer of mortgage & Transfer of mortgage Definition