Editor’s note: This post was originally published in April 2010 and has been substantially updated to reflect current FHA assumption requirements and today’s rate environment. This is not legal advice; consult an attorney for guidance specific to your situation.

Did you know FHA mortgages are assumable?

If you have an FHA-insured mortgage at a rate well below today’s market, that loan could become one of your biggest selling points when it’s time to move. FHA loans are assumable, meaning a qualified buyer can take over your existing mortgage — rate, balance, and remaining term — instead of opening a brand-new loan at current rates. In a market where new mortgage rates run meaningfully higher than rates from a few years ago, that’s a real advantage over a comparable listing without an assumable loan. [Read more…]