Which of the following is true concerning an assumable mortgage?
A)The aggregate percent of the mortgage pool that has been prepaid prior to the month under consideration.
B)The mortgage contract is transferred from the seller to the buyer of a house.
C)The required interest spread of a pass-through security over a treasury when prepayment risk is taken into account.
D)A mortgage-backed bond issued in multiple classes or tranches.

Question

Quizplus · Accepted Answer

An assumable mortgage is a type of mortgage that can be transferred from the seller of a home to the buyer. This means that the buyer can take over the existing mortgage contract, rather than having to obtain a new mortgage. This can be beneficial for buyers if the interest rate on the assumable mortgage is lower than the current market rate.

Which of the Following Is True Concerning an Assumable Mortgage