3% mortgage rates aren’t dead—housing market sees 127% increase in buyers taking over old loans

Some homebuyers are avoiding high mortgage rates by taking over existing loans with lower rates through assumable mortgages. These mortgages, often backed by the FHA, VA, or USDA, can be assumed by buyers if certain conditions are met. Although fewer than one in six outstanding mortgages are potentially assumable, the number of assumed mortgages is increasing, with a 127% increase over the past two years. According to HUD, the number of FHA-insured mortgages assumed has risen from 2,549 in 2021 to 5,861 in 2024. However, there are challenges with assumable mortgages, including the need for buy-in from both parties and a substantial down payment. To address these challenges, Roam, a real estate portal, was launched to exclusively showcase homes with assumable loans. Roam finds properties with assumable mortgages and coordinates the assumption process for buyers. The company, which has raised $11.5 million in funding, lists properties in 18 states and makes money by collecting a 1% fee from buyers. Roam's platform has seen demand for assumable mortgages, particularly in the Sun Belt, where sellers are willing to work with buyers to do an assumable sale. According to Roam's CEO, sellers who advertise their low-rate mortgage can attract more buyers and even net an additional 5% on their home sales price.