A Maryland lender makes a conventional home mortgage loan in 2026. No other state or federal rule already requires divorce-related assumability, and the agreement omits any provision permitting a qualifying existing borrower to assume the other borrower portion after an absolute divorce. Does it comply with Financial Institutions section 11-522(a)?
Correct Answer
C) Noncompliant: a divorce assumption provision must be included
A mortgage lender or mortgage lending business shall include in any conventional home mortgage loan a provision authorizing an existing borrower to purchase the property interest of another borrower by assuming that portion of the mortgage where the assumption is in connection with a decree of absolute divorce and the assuming borrower qualifies. Other choices: the requirement is statutory; it does not depend on the current state of the marriage; and sale of the loan does not excuse it. Source: Md. Fin. Inst. § 11-522(a)(2)
Why This Is the Correct Answer
A mortgage lender or mortgage lending business shall include in any conventional home mortgage loan a provision authorizing an existing borrower to purchase the property interest of another borrower by assuming that portion of the mortgage where the assumption is in connection with a decree of absolute divorce and the assuming borrower qualifies. Other choices: the requirement is statutory; it does not depend on the current state of the marriage; and sale of the loan does not excuse it. Source: Md. Fin. Inst. § 11-522(a)(2)
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