Mortgage assumptions:
Understanding your options

What is an assumption?

A home loan assumption allows you as the buyer to accept responsibility for an existing debt secured by a mortgage on the home you’re buying.
The two processes available to suit your needs are Qualified Assumptions, and the Name Change and Title Transfer Requests.

Compare and find the option that’s right for you:

Information

Qualified Assumptions (QA)

  • May allow for release of liability
  • Credit qualification required
  • Average 90 day processing

Overview

This option allows you to release existing borrowers from an existing loan while maintaining the same terms and conditions.
QA is a loan approval process similar in nature to refinancing, and involves income and credit qualifying.

NOTE: Not all loan programs are assumable. For more information, download the Qualified Assumption application package.

Cost

This is determined by the loan program and (in some cases) where the property’s located. The average assumption fees range from $562 to $1,062. Additional 3rd party fees may apply.

Getting Started

Simply download the Qualified Assumptions application package, fill in the required information and mail it to Qualified Assumptions, TX2-981-03-25, 7105 Corporate Drive, Plano, TX 75024 to start the process.

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Information

Name Change and Title Transfer Request

  • Allows for transfers of title
  • Simple name changes
  • Removal of deceased borrowers

Overview

This option lets you make administrative changes to loans that don’t result in release of liability. Changes may include altering the names of existing borrowers that may have changed due to marriage, divorce or death; or changes to the title (deed) by either transferring ownership to a Trust or adding family members to the deed if all requirements are met.

NOTE: This process cannot release any borrower from liability for the debt.

Cost

Most of the services provided have little to no cost and range from $0-$125

Getting Started

Simply download the fax cover sheet and fax the requested information to 1-866-200-5596 to start the process.

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If you're still not sure which option is right for you, please choose one of the following Frequently Asked Questions (FAQs) to get more information.

Qualified Assumption Frequently Asked Questions (FAQs)

Are all loans assumable?

Answer: No, all loans are not assumable. Assumption eligibility is determined by verbiage in the note/mortgage. Generally ARM loans in the adjustable period, VA, and FHA loans are assumable.

What are the requirements to assume a loan?

Answer: A qualified assumption requires the assuming borrower to qualify for credit based on current underwriting guidelines. Credit score, debt-to-income ratios and other factors may be used to determine qualification, but vary based on loan type.

Will Bank of America remove my ex-spouse based on the requirements of my divorce decree?

Answer: A divorce decree typically does not obligate a lender to remove a borrower. The person that is awarded the property will typically have to qualify solely on his or her credit profile based on current underwriting guidelines regardless of the requirements of the divorce decree.

What if my divorce is not final?

Answer: A fully executed divorce decree/separation agreement along with a property settlement agreement that clearly details the requirements each party is obligated to follow (related to the property) is required in order to move forward with an assumption request.

How can a loan be assumed in the event of a death of the borrower?

Answer: The successor that is on title prior to the customer’s death or has inherited the property through probate will need to qualify for credit in order to assume the liability.

Do I have to go through the assumption process if I used my VA entitlement to secure the original financing
and would like to release the co-borrower?

Answer: No. If the remaining obligated veteran used their entitlement to secure the original financing, the VA Regional Loan Center would need to approve the release of the co-borrower. The assumptions unit at the bank will process the release based on all the terms being met in the documented VA release letter.

What happens if the assuming borrower does not qualify to assume the loan?

Answer: If the assuming borrower does not qualify to assume the existing loan, he/she may choose to apply for a new loan by simply contacting a mortgage loan officer at 1.866.536.0575.

Can I have someone co-sign with me for the assumption?

Answer: Yes, co-signers are permitted, but there are loan program restrictions specific to qualifying with a non-occupying borrower that will be discussed once your application is received.

Will the seller remain financially responsible for the loan once the Qualified Assumption is approved and completed?

Answer: No. Once a Qualified Assumption is approved and closed, the seller is released from all future liability associated with the loan.

Will the person being released from liability for the loan be required to sign any documents?

Answer: Yes. In order to complete the Qualified Assumption, the person being released from financial liability will be required to sign certain documents. Because of this, a seller who is unable or unwilling to cooperate can prevent this process from being an option.

If I have a VA loan, does an assumption restore my eligibility?

Answer: The Qualified Assumption process primarily releases one or more borrowers from liability for the debt. Only if the person(s) assuming the loan has their own eligibility to substitute for the borrower being released will the eligibility be restored. If the buyers do not have any eligibility to substitute, then the original eligibility remains with the loan until it is either paid off or refinanced.

Name Change and Title Transfer Request Frequently Asked Questions (FAQs)

Is there a fee required in order to change my name on the account?

Answer: No, a fee isn’t required in order to change your name on the account.

How long does it take for my name to be changed on the account?

Answer: Your name will be changed on the account within three business days after receiving the required documentation.

Can the title be transferred to an unrelated third party?

Answer: No, the title generally cannot be transferred to an unrelated third party.

Can the title be transferred to an LLC, corporation or partnership?

Answer: No, the title cannot be transferred to an LLC, corporation or partnership.

Can the title be transferred to a direct family member?

Answer: Under certain circumstances, a title transfer to a direct family member can be made as long as certain conditions are met.

Can the title be transferred to a living trust?

Answer: Yes, the title can be transferred to a living trust if the borrower is the beneficiary and occupies the property.

How long does it take to get a decision on a title transfer request?

Answer: You will be sent a notice of the bank’s decision within three business days of receiving your request.

What is required in order to gain access to an account in the case of death?

Answer: The successor that is on title prior to the customer’s death or has inherited the property through probate generally will be granted access. If you were not on title prior to the customer’s death, legal documentation identifying you as the administrator/executor/heir for the decedent’s estate will be required.

What if I’ve already transferred title and it’s not approved by the bank?

Answer: A notice will be sent to you requesting documentation so that we may review for possible consent to the title transfer. It is important to note that without proper consent to the title transfer, the loan may be required to be paid in full or the property transferred back to the original owner.

Where do I send correspondence to change my name on the account, request access as the successor, or request consent to transfer title?

Answer: You can either fax to 1.866.200.5596 or mail to the address listed below:

Bank of America N.A.
Mail Stop CA6-914-01-90
1800 Tapo Canyon Rd.
Simi Valley, CA 93063

What documentation do I need in order to update an account to reflect that the borrower is deceased?

Answer: A death certificate is required in order to update an account to reflect that a borrower is deceased.

Where do I send notification to the bank that a borrower is deceased?

Answer: You can send the death certificate and any related court-approved documentation identifying administrator, executor or heirs by fax to 1.866.694.9046 or mail to this address:

Bank of America N.A.
Estate Department
P.O. Box 982263
El Paso, TX 79998-2263

How will I know if additional documentation is required?

Answer: A notice will be sent requesting additional documentation within three business days of receiving the access request.

This web page is intended to provide general answers to most frequently asked questions for the assumption of a loan. However, your specific loan request may have additional requirements that include, but are not limited to: satisfying investor guidelines, complying with state and federal laws, and adhering with the bank’s policies and procedures from the time of application to post-funding. For specifics and additional answers regarding your loan request, please contact Bank of America’s Customer Service Department at 1.800.669.6607.