Full question:
I am going to assume ownership of the home. I am looking for a contract to protect myself from them coming back and want their home back. I am not in a position to get financing through a bank so they are okay with this situation. Looking for a contract to take full assumption and responsibility of the home. They will not make any money off of the assumption to me. I will start paying the mortgage as soon as I move in the house.
- Category: Contract for Deed
- Date:
- State: Texas
Answer:
It's important to clarify whether the lender has approved your assumption of the mortgage. A contract for deed, also known as a land contract, can be a useful alternative for financing the purchase of a property. Under this agreement, you won't receive the actual deed until you fulfill the payment terms. Until you receive the deed, ownership is not fully transferred, and the property could be foreclosed if the current mortgage is not paid.
Payment responsibility is separate from ownership. If there's an existing mortgage, your agreement may violate a due-on-sale clause, which many lenders include in their mortgage contracts. This clause allows the lender to demand full payment of the loan if the property is sold or transferred without their consent. If foreclosure occurs, you risk losing any payments you've made and the home itself.
This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.