Assumable mortgages allow homebuyers to take over a seller's existing loan at a potentially much lower interest rate, thereby significantly reducing monthly payments.
The Federal Reserve's action during the COVID-19 pandemic led to historically low mortgage rates in 2021, but subsequent inflation-triggered rate hikes pushed rates to a peak of 7.79%.
Mortgage rates are currently decreasing, with a recent drop to 6.2% as of mid-September, but the ultra-low rates seen in 2021 are unlikely to return.
Not all loans qualify for assumption; however, FHA and VA loans are eligible, making assumable mortgages a viable option for many homebuyers.
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