Finance
An assumable mortgage in Virginia allows a qualified buyer to:
AApply for a new mortgage with the same lender
BTake over the seller's existing mortgage with its current terms✓ Correct
CAvoid paying closing costs at settlement
DObtain a mortgage without income verification
Explanation
An assumable mortgage allows a qualified buyer to take over the seller's existing loan, including its interest rate and remaining balance. FHA and VA loans are generally assumable; most conventional loans are not.
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Key Terms to Know
Closing Costs
Fees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
AmortizationThe gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Math Concepts
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