Finance
What does 'assumption of mortgage' mean in an Alaska real estate transaction?
AThe buyer takes out a new loan to pay off the seller's existing loan
BThe buyer takes over the seller's existing mortgage obligation with the lender's consent✓ Correct
CThe seller guarantees the buyer's new loan
DThe lender insures the mortgage against buyer default
Explanation
Mortgage assumption occurs when the buyer steps into the seller's place on the existing loan and agrees to make the payments. Many modern loans have due-on-sale clauses that prevent assumption without lender approval.
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