That COVID era loan does NOT have to go away…. some are assumable
SOURCE: NREB © 2026 National Real Estate Brief August 15, 2026
YOU HAVE OPTIONS…FIND AN FHA AND VA EXPERT
Freddie Mac's own weekly survey averaged near 3% through 2020 and 2021, touching an all-time low of 2.65% in January 2021. Many FHA and VA loans originated during that window carry rates in that neighborhood, fixed for the remaining life of the loan.
This week, the same survey reads 6.69%, a 2026 high. So the market contains an enormous stock of government-backed loans written at roughly half of today's rate.
ASK YOUR LENDING EXPERT ABOUT:
On FHA loans closed since late 1989, the buyer must pass a full creditworthiness review with the servicer.
On VA loans, the servicer must approve the assumption. And the fact that surprises nearly everyone, agents included: the buyer assuming a VA loan does not need to be a veteran. Any buyer who meets the financial requirements can assume one, subject to servicer approval and considerations for the seller we will get to, because they matter enormously.
None of this is marketed to you. Existing loan type is often difficult to identify or search consistently through ordinary MLS workflows, so an assumable 3% loan and a nontransferable 7% loan can look identical in every search your buyers run.
The asset is invisible unless someone asks about it, and the question is easy to overlook.
WHAT DOES THIS LOOK LIKE?
EXAMPLE: The home: $450,000. The seller's loan: an FHA mortgage from early 2021, $320,000 remaining balance at 3.25%, roughly 24 and a half years left on the original 30-year schedule.
The standard script: your buyer puts 10% down and borrows $405,000 at this week's 6.69%. Principal and interest: about $2,611 a month.
The assumption: your buyer steps into the seller's $320,000 balance at 3.25%. Principal and interest: about $1,580 a month.
The difference is roughly $1,031 a month, more than $12,000 a year, on the same house. Not from negotiating harder, not from any concession, but from not extinguishing the financing that already exists on the property. Before solving the equity gap, the assumed first alone cuts principal and interest by roughly a thousand dollars a month. How much of that advantage survives once the seller's equity is funded is the question that matters, and it is exactly where this is heading.
WHAT HAPPENS TO THE EQUITY?
EXAMPLE: The buyer assumes a $320,000 balance. The home costs $450,000. The difference, $130,000, is the seller's equity, and the seller does not donate it. That equity has to be satisfied as part of the closing, through buyer cash, approved secondary financing, seller financing where permitted, or some combination. Your buyer had $45,000 ready for their planned 10% down payment, which means they are $85,000 short of making this transaction exist.
This is the equity gap, and it is why the folk wisdom says assumptions only work for cash-heavy buyers, which would make everything above a curiosity instead of a strategy. The instinctive fix, borrowing the difference, raises its own alarm: second-lien money is expensive, close to 9% right now, and stacking a high-rate second on top of the assumed loan feels like it should burn up the whole advantage. And structured carelessly, the fix can be worse than expensive: done wrong, it can jeopardize the servicer's approval, the assumed first mortgage itself, or a veteran seller's most valuable benefit.
THIS IS WHERE YOUR EXPERT TAKES THE REIGNS…get side by side options. In any case, it is worth the ask…
THIS HAS BEEN A BRIEF LOOK AT THE POSSIBILITIES…
Get your options laid out before you go on the market. This could make the difference in how quickly your property sells.
Can you imagine how many offers you might receive if they knew that it is possible to assume a loan at very low rates?