How Long Does an Assumable Mortgage Take?
Understanding the Timeline for Assumable Mortgage Transactions
Are you wondering how long it takes to complete an assumable mortgage? The answer depends on several factors, including the lender managing the existing loan and the specific type of mortgage involved. At Assumable, we have over 13 years of experience in the industry and work closely with lenders to streamline the process. On average, our customers save $1,013 per month and $323,000 in interest by choosing to assume a mortgage.
Typically, the process takes between 30 to 45 days, though in some cases, it may require 60 to 90 days. But why does it sometimes take so long? Let’s break down the details.
Why Is the Assumable Mortgage Process So Time-Consuming?
Mortgage assumption is more than just transferring ownership. Lenders must evaluate and approve the buyer’s financial qualifications. This includes reviewing:
- Creditworthiness
- Income verification
- The buyer's ability to cover any equity differences
Lenders also need to issue a release statement for the seller, officially releasing them from further mortgage responsibility. This underwriting and approval process can be time-intensive, especially for government-backed loans like VA, FHA, or USDA mortgages, which have added regulatory requirements.
How Loan Type Affects Your Timeline
- VA Loans: Historically, VA loans can take 60 to 90 days to process assumptions. Recent guideline changes aim to reduce this timeline to around 45 days.
- Conventional Loans: These loans may process faster, typically averaging 30 to 45 days. However, some lenders may prioritize new loan originations over assumptions, which can result in delays since assumptions generate less revenue for the lender.
Tips to Speed Up the Assumable Mortgage Process
While the process can seem lengthy, there are proven ways to shorten the timeline:
- Sellers: Communicate early with your mortgage servicer and have all necessary documents ready to help the buyer get a head start.
- Buyers: Get pre-approved or pre-qualified before making an offer to help streamline lender approvals.
- Work with Experts: At Assumable, we coordinate with all parties involved to manage paperwork and communicate directly with lenders, helping you avoid common pitfalls and delays.
What to Expect When You Work with Assumable
- 30 to 45 days is a typical timeframe for most lenders.
- 60 to 90 days or longer may be required for VA loans or lenders with slower processing.
- The exact timeline depends on lender policies, loan type, and the buyer’s financial situation.
- Clear communication and expert assistance can significantly reduce delays.
Ready to Explore Assumable Mortgages?
Are you considering an assumable mortgage? Work with the professionals at Assumable. Check out our app—it’s packed with everything you need to know about finding assumable mortgages nationwide.
