FHA Mortgages - They Are Assumable. How to take advantage?

New Jersey Real Estate Q&A Discussion Forum
3yFollow

FHA Mortgages - They Are Assumable. How to take advantage?

Frank Martielli
Middlesex, NJ · Member since 2014 · 34 posts · 23 votes

FHA Loans are assumable, as are most (all?) govt backed loans, I believe.

I've been thinking about this myself. All the 3-4% mortgages out there are assumable. But how to take advantage of that?

Looking for anyone else's input or experience, and might even be interested in teaming up with people.

Thanks everyone.

Sincerely,
Frank

1Reply
68 views

5 Replies

Jump to latestLatest
  • Ryan Muska
    Lender · Saddle Brook, NJ · Member since 2023 · 431 posts · 231 votes
    3y

    If they are assumable, remember that they will want a larger down payment as the property has most likely appreciated since the original purchase. 

    0Reply
  • Frank Martielli
    OP
    Middlesex, NJ · Member since 2014 · 34 posts · 23 votes
    3y

    Yes, I'm not worried about that I don't think. My thoughts center around the fact that at least part of the overall mortgage would be financed at 4% or less as opposed to all of it being financed at 8%+-

    0Reply
  • Kevin Zhang
    San Francisco, CA · Member since 2018 · 62 posts · 20 votes
    2y
    Quote from @Ryan Muska:

    If they are assumable, remember that they will want a larger down payment as the property has most likely appreciated since the original purchase. 

     @Ryan Muska. Under assumable FHA loan can i live in there for 1 year and then rent it out as vacation after a year? Thanks.

    0Reply
  • Ryan Muska
    Lender · Saddle Brook, NJ · Member since 2023 · 431 posts · 231 votes
    2y
    Quote from @Kevin Zhang:
    Quote from @Ryan Muska:

    If they are assumable, remember that they will want a larger down payment as the property has most likely appreciated since the original purchase. 

     @Ryan Muska. Under assumable FHA loan can i live in there for 1 year and then rent it out as vacation after a year? Thanks.


    I would assume that is fine. But I am not licensed in CA and cannot provide CA-specific advice on FHA loans, speak with a lender that is licensed there.

    0Reply
  • Frank Martielli
    OP
    Middlesex, NJ · Member since 2014 · 34 posts · 23 votes
    2y

    Ah, I didn't even think of this part. Anyone know what the actual rule is?

    Under this scenario, would the new owner have to occupy for a year?

    The way I see it is since we aren't disturbing the original mortgage and just taking it over, if the one year requirement has been met (which is a guarantee under this scenario) why would it have to be met again?

    1Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free