re: #595 FurryOldGuyJeans

My parents in 1975 used ‘mortgage assumption’ to buy a house, taking over an existing mortgage while making an additional and sizable payment to the current mortgage holder.

Unfortunately, most mortgages today contain a due on sale clause and/or an acceleration clause that makes assumption impossible. If lenders eliminated those clauses on existing loans, some people who are currently underwater might be able to find buyers who would assume the loan. There’s no equity anyway, so it would just be taking over payments. Obviously this would only work with fixed rate loans, but even if it’s one of those outlandish ARMs, a qualified buyer could refinance. The seller avoids foreclosure, the bank gets money, someone gets a house.