Assumption of Mortgage
An Assumption of Mortgage occurs when you you purchase a home and assume a pre-existing mortgage. You undertake to fulfill the obligations of the existing loan agreement the seller made with the lender. The obligations are similar to those that you would incur if you took out a new mortgage. When assuming a mortgage, you become personally liable for the payment of principal and interest. The seller, or original mortgagor, is released from the liability, and should get that release in writing. Otherwise, he or she could be liable if you don't make the monthly payments.
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See Also
Interest
Lender
Loan
Mortgage
Mortgagor
Principal
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