Finance
A buyer assumes the seller's existing mortgage. The buyer is now primarily liable for the debt, and if the lender releases the seller from the original obligation, this is called:
ASubordination
BNovation✓ Correct
CEstoppel
DSubrogation
Explanation
Novation occurs when the lender releases the original borrower (seller) from liability and substitutes the new buyer as the party responsible for the debt. Without novation, the seller remains secondarily liable even after the buyer assumes the mortgage.
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