FinancingCreative_financingMEDIUM
At closing, Maya Morgan agrees to take over the seller's existing mortgage rather than obtain a brand-new loan. What is this financing arrangement called?
Correct Answer
C) Loan assumption
Loan assumption is correct because the facts match the taking over of an existing loan obligation by a new borrower, subject to any required lender approval. That is the best description of the relationship, right, or legal concept tested here.
Answer Options
A
Balloon paymentB
Purchase subject to an existing loanC
Loan assumptionD
Shared-equity financingWhy This Is the Correct Answer
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Related Topics & Key Terms
Key Terms:
creative_financingfinancingassumptionexisting_loan
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