With assumable mortgages, you can snag a three percent interest rate even in 2023’s high-interest environment. These loans exist everywhere around you—you could be sitting on an assumable loan without even knowing it! So, if there’s a way to pick up properties at all-time low-interest rates, why isn’t everyone taking advantage of assumable mortgages? We brought Craig O’Boyle from Assumption Solutions on to the show to explain.

Assumable mortgages aren’t new, but most real estate agents, loan brokers, and homebuyers have no idea what they are. In practice, an assumable mortgage allows a homebuyer to “assume” a seller’s loan with the same interest rate, contingencies, and principal paydown as the seller. This means you can walk into a home with significant equity, a low-interest rate, and the same fix-rated loan you’d be picking up from a bank. But, if you want an assumable mortgage, you’ll need to know where to find one.

Craig walks us through the ins and outs of assumable mortgages, where investors can find one, why most mortgage lenders and brokers don’t know about them, and one BIG caveat you’ll need to hear before you chase down this better financing. Want a lower rate and monthly payment with higher cash flow? Stick around; we’ll give you everything you need to know to find a low-interest assumable loan in your area!

In This Episode We Cover

Assumable mortgages explained and why a bank would allow a buyer to assume a loan

Assumable loans vs. subject to and how one strategy is far riskier than the other

Fees you can expect to pay when purchasing a property with an assumable mortgage

House hacking and using assumable loans to profit off your primary residence

The three types of loans that can be assumable (and others that WON’T work)

The “assumption gap” and money you’ll need at closing to get the deal done

And So Much More!

Links from the Show

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Subject To Real Estate Explained

Connect with Craig:

Craig's Website

Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-74

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74: Assumable Loans: How to Time Travel Back to 3% Rates on Your Next Buy w/Craig O'Boyle 44:39 Share

On The Market

Shownotes Transcript

74: Assumable Loans: How to Time Travel Back to 3% Rates on Your Next Buy w/Craig O'Boyle