Three percent mortgage rates — aren’t those a thing of the past? 

It depends: yes and no. There are a lot of homeowners who currently have a three percent mortgage rate. Today, if you were applying for a mortgage, even if you decided to go with an adjustable rate mortgage, credit union, or buy down the mortgage rate, it is unlikely you would get a three percent rate.

So how could a home buyer in today’s market still get a 3 percent rate? The answer is Assumable Financing. Assumable Financing or an Assumable Loan means that the new buyer assumes or takes over the homeowner’s current loan. The buyer would have to apply for and qualify for that loan.

Assumable financing is can be a creative way for a home buyer to get into a home. On the flip side, for a home seller, it can be why you can sell at or over market value because of how attractive your mortgage rate is to potential home buyers. 

3 Myths about Assumable Financing:

1. All Loans are Assumable 
2. Assumable Financing is really difficult 
3. Assumable Financing is the same as Seller Financing

Busting these myths means taking a deeper dive into Assumable Financing. What is assumable financing? What makes a loan assumable?

Busting 3 Myths about Assumable Financing:

Myth Busted #1 – Not all loans as assumable, it depends on whether the original loan was conventional, VA, FHA, or another type of loan. All FHA and VA loans are assumable pending any lender requirements and approval.  

Myth Busted #2 – Assumable Financing might include more forms in the transaction and applying with that lender for the specific loan, but with an experienced and hard working real estate (me) in your corner, we can get you to the finish line. The assumable loan can become a contingency of the purchase. 

Myth Busted #3 – Assumable Financing and Seller Financing are not the same thing. When a property is sold with Seller Financing, the seller essentially becomes the bank. Sometimes a seller can charge a higher mortgage rate than even other banks. With Assumable Financing, you are applying for that exact mortgage. 


Do you have a VA or FHA loan on your home? Are you curious about whether you could offer your loan in the sale? Reach out to KALEO Real Estate Company at (626)609-2130 today!