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When interest rates rise- and they will buyers have another avenue of financing: Taking over or "subject to " the loan. As loan balances will be lower than property values, as values rise most loans that are not assummable formally through the bank. There are ways to insure the lender is not notified of the unauthorized transfer. there is some level of risk. Would a bank rather have a loan with current payments or one with a seller who can''t sell because of tight credit that is facing foreclosure?
If the seller has remaining equity, then they could carry a 2nd loan ordo what we call a wrap around or All Inclusive Deed of Trust ( A.I.T.D).
there are insurance issues as well as how the payment is made, and in California I suggest and recommend both parties consult with a real estate attorney. iam here to help if you need it on your transaction, or need to get out of your property or are a buyer with credit impairment.
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