Company says loan option can prompt interest savings for buyers
Non-QM lender Carrington Mortgage Services (CMS) has added a new loan option for customers: assumable mortgages.
The new offering allows qualified buyers to purchase a home by taking over a seller’s loan, including the current balance, interest rate, remaining term, and other terms. The nonbank said assuming an existing loan could potentially result in interest savings if the mortgage has a lower interest rate compared to current market rates.
“Carrington is committed to ensuring borrowers have every possible opportunity to obtain a loan on the home they want,” said Greg Austin, executive vice president of mortgage lending for CMS. “Assumable mortgages are another loan option that Carrington educates home sellers and buyers about in this very complex real estate market.”
Carrington’s real estate division, Vylla Home, works with eligible homeowners, prospective buyers, and sellers to educate them on the program. The company noted that not all types of mortgages are assumable, but FHA and VA loans can be assumed, while USDA and Conventional ARM mortgages may be assumable under specific conditions.
“Our real estate agents are able to assist sellers by letting potential buyers know an assumable mortgage is an option,” said Chad Ruggles, senior vice president at Vylla Home. “Vylla Home, and our 1,300-plus dedicated real estate professionals, is uniquely positioned to work with buyers to identify which mortgages may be assumable.”
Sellers with an eligible mortgage for assumption may benefit from advertising the option as it makes their home more attractive to buyers. Assumed mortgages usually have lower fees and don’t require an appraisal. The buyer must go through the application and underwriting process to be approved by CMS and take full liability from the seller.
Carrington offers a range of loan products, including FHA, VA, USDA, and conventional, as well as non-QM and proprietary products for non-traditional borrowers. The company’s ProcessIQ product enables approved wholesale brokers to have Carrington process the loan as part of its underwriting.
Recently, CMS introduced a second-lien program that provides liquidity to existing customers who have seen an increase in the value of their homes and face a rising interest-rate market.
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