A Storm on the Horizon – Chris Gardner

Today’s low interest rates may mean a future rise in mortgage assumptions.

To become a successful originator, it’s generally important to cultivate relationships with real estate agents and originate purchase mortgages. Without purchase deals, one has to rely on the boom-and-bust cycles of the refinance market.

A danger to the purchase market and a threat to future commissions could come from assumable mortgages, whereby a homebuyer agrees to take over the seller’s mortgage. Assumable mortgages are attractive when terms that were given to the seller are more desirable than the terms currently available for the buyer.