Buyers who assume mortgages could be personally liable to repay the debt in the event of a default.
They may also have to pay more for discount points at closing, but not necessarily a 30% premium. option B.
When buyers assume mortgages, they take on the responsibility for repaying the mortgage debt.
This means that if the original borrower defaults on the loan, the buyer is personally liable to repay the debt.
In addition to this risk, buyers who assume mortgages may also have to pay a higher interest rate and more discount points at closing compared to when obtaining a new mortgage.
However, they do not necessarily have to pay a 30% premium for the privilege.
Buyers who assume mortgages become personally liable to repay the debt in the event of a default.
question:
Buyers who assume mortgages:
Select one:
A. Substitute lenders
B. Must pay a 30% premium for the privilege
C. Could be personally liable to repay the debt in the event of
a default
D. Must pay more for discount points at closing