Transfer of Mortgage

Definition of 'Transfer of Mortgage'


A transaction where either the borrower or lender assigns an existing mortgage (bank loan to purchase a residential property) from the current holder to another person or entity. Homeowners who are unable to keep current on their mortgage payments may seek a transfer so that they don't default and go into foreclosure.

Not all mortgages are eligible for transfer. In order to transfer a mortgage, the lender will need to verify that the person or entity that will assume the mortgage has adequate income and credit history to be able to make payments in a timely manner.

Investopedia explains 'Transfer of Mortgage'


If you are not allowed to transfer a mortgage, due to the loan's underwriting, you may need to explore other options to avoid foreclosure. For example, you could work with your lender to see if it's possible to add another borrower/owner to the mortgage which would enable him/her to make payments toward the unpaid loan balance. Or you could sell the home and have a potential buyer, colleague, family member or another entity agree to make up any difference between the home's sale price and the unpaid loan balance.



comments powered by Disqus
Hot Definitions
  1. Benchmark Bond

    A bond that provides a standard against which the performance of other bonds can be measured. Government bonds are almost always used as benchmark bonds. Also referred to as "benchmark issue" or "bellwether issue".
  2. Market Capitalization

    The total dollar market value of all of a company's outstanding shares. Market capitalization is calculated by multiplying a company's shares outstanding by the current market price of one share. The investment community uses this figure to determine a company's size, as opposed to sales or total asset figures.
  3. Oil Reserves

    An estimate of the amount of crude oil located in a particular economic region. Oil reserves must have the potential of being extracted under current technological constraints. For example, if oil pools are located at unattainable depths, they would not be considered part of the nation's reserves.
  4. Joint Venture - JV

    A business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task. This task can be a new project or any other business activity. In a joint venture (JV), each of the participants is responsible for profits, losses and costs associated with it.
  5. Aggregate Risk

    The exposure of a bank, financial institution, or any type of major investor to foreign exchange contracts - both spot and forward - from a single counterparty or client. Aggregate risk in forex may also be defined as the total exposure of an entity to changes or fluctuations in currency rates.
  6. Organic Growth

    The growth rate that a company can achieve by increasing output and enhancing sales. This excludes any profits or growth acquired from takeovers, acquisitions or mergers. Takeovers, acquisitions and mergers do not bring about profits generated within the company, and are therefore not considered organic.
Trading Center