Finance
A Montana ranch buyer is assuming an existing loan. Which statement is true about a loan assumption?
AThe original borrower is always released from liability
BThe buyer takes over the existing loan terms and the seller may remain secondarily liable unless released✓ Correct
CThe lender must approve the assumption only for FHA loans
DLoan assumptions are not permitted in Montana
Explanation
When a buyer assumes an existing loan, they take over the terms and payments. The original borrower (seller) may remain secondarily liable unless the lender provides a formal release of liability.
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