Mortgage Assumptions in Partition Actions

An assumable mortgage is one where the buyer assumes the existing mortgage of the seller. When the mortgage is assumed, the seller is often no longer responsible for the debt. As it relates to co-ownership, the buying co-owner would thus assume the full liability for the mortgage, thereby relieving the selling co-owner.

One reason buyers of a property in a partition action may choose to buy a home with an assumable mortgage is to take advantage of a lower interest rate if rates have risen since the seller originally purchased the home.

Unfortunately, not all home loans are assumable. In fact, most conventional mortgages are not assumable.

Subject to certain requirements, assumable home loans are those insured by the Federal Housing Administration (FHA), Department of Veterans Affairs (VA), and the United States Department of Agriculture (USDA).

FHA Loans Assumable in Partition Actions

FHA mortgages are generally more accessible to buyers with a less-than-ideal credit history since credit scores must be above 580 to apply with most lenders, according to FHA.com.

Generally, FHA loans require that both buyer and seller meet specific criteria for an assumable mortgage. Sellers must live in the home as a primary residence for a set amount of time, and buyers must go through the standard application process for an FHA loan.

VA Loans Assumable in Partition Actions

Backed by the Department of Veterans Affairs, a VA loan is available to eligible military members, service members, and their spouses. A buyer who is not a qualified current or former military service member can apply for a VA loan assumption. It should be noted that if the loan is assumed by someone who wouldn’t ordinarily qualify for a VA loan, the seller gives up their VA entitlement.

USDA Loans Assumable in Partition Actions

USDA loans are also assumable. The most important thing to know is that in most circumstances, approval from the lender and the USDA is required.

Assuming a Loan in a Partition Action

There are many ways to buyout your co-owner in a partition action, including the new Partition of Real Property Act appraised buyout. The rules relating to assumptions in partition actions are not entirely clear. A skilled partition attorney in California can help you navigate the complex rules to ensure a fair outcome.

Talkov Law's Partition Attorneys Can Help

If you want to end your co-ownership relationship, but your co-owner won’t agree, a partition action is your only option. With seven, full time partition lawyers, Talkov Law is the #1 partition law firm in California and has handled over 300 partition actions throughout California. Every case has resulted in a sale to either a third party or one of the co-owners. Not a single court has denied our clients the right to partition or declared our client to be a non-owner. Plus, for qualified cases, there is no fee until we settle or win your case!

If you're looking to end your co-ownership dispute, contact California's premier partition action law firm by calling Talkov Law at (844) 4-TALKOV (825568) or sending us a message today.

Attorney Colleen Sparks
About Colleen Talkov

Colleen Talkov is a Partition Attorney at Talkov Law in California. She can be reached at (844) 4-TALKOV (825568) or colleen@talkovlaw.com.

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