Can I Assume this Assumable Loan Will Be a Deal?
I've been drawn to some B-C class townhomes in the greater Birmingham AL area and I am wondering if this place is a deal or not. The area is prime for growth and property appreciation. The townhome is a 2 bedroom 1.5 bath. The two rooms are upstairs and have a jack and jill bathroom. The interior has been renovated (crown moulding, all new appliances, tile backsplash in kitchen. A similar property was recently leased for $725/mo. The current owner purchased the property before the recession at $105k, and the property is now valued about $85-$90k. She owes $86k and has what she calls an "Assumable Loan". If what she says is correct, I would assume the remainder of the debt, and only pay 1% of its value toward closing and it's mine. Her property taxes, loan payment, utilities run about $600/mo.
Can someone give me some more info on assumable loans? Does this sound like it could potentially be a good deal?