Assumption Fee:
A fee charged by a lender to cover the administrative costs associated with transferring an existing mortgage from one borrower to another. This fee is typically paid by the new borrower who is assuming the existing mortgage and is separate from the down payment and other closing costs.
An assumption fee is a charge imposed by a lender when a borrower assumes an existing mortgage. This fee is typically paid by the new borrower who is taking over the mortgage from the original borrower. The assumption fee covers the administrative costs associated with transferring the mortgage to the new borrower and may also include a fee for the lender’s review and approval of the new borrower’s creditworthiness. The specific amount of the assumption fee and the terms of payment are typically outlined in the mortgage agreement.
1. What is an Assumption Fee?
An Assumption Fee is a fee charged by a lender when a borrower takes over an existing mortgage loan.
2. How much is the Assumption Fee?
The Assumption Fee varies depending on the lender and the terms of the loan. It can range from a few hundred dollars to several thousand dollars.
3. Who pays the Assumption Fee?
The borrower is responsible for paying the Assumption Fee.
4. When is the Assumption Fee due?
The Assumption Fee is typically due at the time of the assumption of the loan.
5. Can the Assumption Fee be waived?
It is possible for the Assumption Fee to be waived, but this is at the discretion of the lender.
6. What is the purpose of the Assumption Fee?
The Assumption Fee is charged to cover the costs associated with processing the assumption of the loan, including administrative and legal fees.
7. Is the Assumption Fee tax-deductible?
The Assumption Fee may be tax-deductible, but it is recommended to consult with a tax professional for specific advice.
8. Can the Assumption Fee be included in the loan amount?
In some cases, the Assumption Fee can be included in the loan amount, but this is at the discretion of the lender.
9. What happens if the Assumption Fee is not paid?
If the Assumption Fee is not paid, the lender may refuse to allow the assumption of the loan to take place.
10. How can I find out more about the Assumption Fee?
To learn more about the Assumption Fee, it is recommended to speak with a lender or mortgage professional.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 29th March 2024.
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