Assumptions
Frequently Asked Questions

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Question 1 - If a mortgage has been assumed, whose name(s) should appear on a Partial Claim Subordinate Note and Mortgage?

Answer - The name(s) that should appear on the Partial Claim Subordinate Note and Mortgage is the mortgagor qualified for the Loss Mitigation Option.

Question 2 - Should a mortgage be called due and payable if it is current, but the mortgagor who assumed the mortgage refuses to go through the creditworthiness process?

Answer - Even if the mortgage is current (per HUD Handbook 4330.1 REV-5, Chapter 6, Paragraph 6-5 A), if the assumptor falls within one of the categories stated in the assumption chart referenced above and the assumptor refuses to go through the creditworthiness process, then the mortgagee must enforce this requirement and issue the acceleration letter.

Question 3 - The present mortgagors are eight payments delinquent. During the Loss Mitigation Review, it was determined that they qualified for a Loan Modification. The loan originated December 12, 1988 and the present mortgagors assumed this mortgage less than 12 months ago. Since the assumption took place less than a year ago, is this assumptor eligible for a Loan Modification?

Answer - Yes, the assumptor would be eligible for a Loan Modification as the loan originated December 12, 1988 and 12 months have elapsed since the origination date.

Question 4 - In looking at the possibility of an assumption, must the mortgage be underwritten or can an Approved Direct Endorsement (DE) Underwriter sign off on the Analysis Worksheet?

Answer - An Approved DE Underwriter can sign off on the Analysis Worksheet on an assumption.