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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Texas dances to the same music as all other states. Posted by Ward-CA- on March 13, 2002 at 7:32 AM In Reply to: assumability of mortgage loans in texas??? posted by Jason on March 12, 2002 at 4:53 PM : Generally, are mortgage loans assumable by a 3rd party in Texas. If it depends on the loan or the lender, approximately what percentage are assumable? If a loan is assumable (not due on sale), does that mean a 3rd party can take over the existing loan and its terms without getting approval or going through a credit/job check? Where can I find out more information on this? : Thanks, : Jason =•=•=•=•=•=•=•=•=•=•= Jason, I doesn’t matter what state you’re in regarding one’s ability to avoid the due on sale clause found in most trust deeds and mortgages. Nor does it matter the priority of the affected lien. This whole issue was settled in the 1982 federal act called the Garn-St. Germain Depository Institutions Act. According to the Act there are only nine exceptions to a lender’s ability to enforce it’s due-on-sale clause and they are: (d) Exemption of specified transfers or dispositions With respect to a real property loan secured by a lien on residential real property containing less than five dwelling units, including a lien on the stock allocated to a dwelling unit in a cooperative housing corporation, or on a residential manufactured home, a lender may not exercise its option pursuant to a due-on-sale clause upon - (1) the creation of a lien or other encumbrance subordinate to the lender's security instrument which does not relate to a transfer of rights of occupancy in the property; (2) the creation of a purchase money security interest for household appliances; (3) a transfer by devise, descent, or operation of law on the death of a joint tenant or tenant by the entirety; (4) the granting of a leasehold interest of three years or less not containing an option to purchase; (5) a transfer to a relative resulting from the death of a borrower; (6) a transfer where the spouse or children of the borrower become an owner of the property; (7) a transfer resulting from a decree of a dissolution of marriage, legal separation agreement, or from an incidental property settlement agreement, by which the spouse of the borrower becomes an owner of the property; (8) a transfer into an inter vivos trust in which the borrower is and remains a beneficiary and which does not relate to a transfer of rights of occupancy in the property; or (9) any other transfer or disposition described in regulations prescribed by the Federal Home Loan Bank Board. Hope this helps. Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : : Generally, are mortgage loans assumable by a 3rd party in Texas. If it depends on the loan or the lender, approximately what percentage are assumable? If a loan is assumable (not due on sale), does that mean a 3rd party can take over the existing loan and its terms without getting approval or going through a credit/job check? Where can I find out more information on this? : : Thanks, : : Jason : =•=•=•=•=•=•=•=•=•=•= : Jason, : I doesn’t matter what state you’re in regarding one’s ability to avoid the due on sale clause found in most trust deeds and mortgages. Nor does it matter the priority of the affected lien. : This whole issue was settled in the 1982 federal act called the Garn-St. Germain Depository Institutions Act. According to the Act there are only nine exceptions to a lender’s ability to enforce it’s due-on-sale clause and they are: : (d) Exemption of specified transfers or dispositions : With respect to a real property loan secured by a lien on residential real property containing less than five dwelling units, including a lien on the stock allocated to a dwelling unit in a cooperative housing corporation, or on a residential manufactured home, a lender may not exercise its option pursuant to a due-on-sale clause upon - : (1) the creation of a lien or other encumbrance subordinate to the lender's security instrument which does not relate to a transfer of rights of occupancy in the property; : (2) the creation of a purchase money security interest for household appliances; : (3) a transfer by devise, descent, or operation of law on the death of a joint tenant or tenant by the entirety; : (4) the granting of a leasehold interest of three years or less not containing an option to purchase; : (5) a transfer to a relative resulting from the death of a borrower; : (6) a transfer where the spouse or children of the borrower become an owner of the property; : (7) a transfer resulting from a decree of a dissolution of marriage, legal separation agreement, or from an incidental property settlement agreement, by which the spouse of the borrower becomes an owner of the property; : (8) a transfer into an inter vivos trust in which the borrower is and remains a beneficiary and which does not relate to a transfer of rights of occupancy in the property; or : (9) any other transfer or disposition described in regulations prescribed by the Federal Home Loan Bank Board. : : Hope this helps. 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