13VAC10-40-140: Loan assumptions

A. The authority may from time to time, in its discretion, permit assumptions of all or some of its single family mortgage loans, subject to satisfaction of (i) the requirements of the insurer, guarantor, or investor with respect to the applicable authority loan program and (ii) the requirements of the tax code if the mortgage loan was funded with the proceeds of tax-exempt bonds; provided, however, that assumptions shall be permitted when required by the mortgage insurer, guarantor, or investor rules or applicable law.

B. If the authority permits an assumption, the authority will determine whether or not the applicable requirements in subsection A of this section for assumption of the loan have been met and will advise the originating lender of such determination in writing. The authority will further advise the originating lender of all other requirements necessary to complete the assumption process. Such requirements may include the submission of satisfactory evidence of hazard insurance coverage on the property, approval of the deed of assumption, satisfactory evidence of mortgage insurance or mortgage guaranty, submission of an escrow transfer letter, and execution of the programs disclosure and borrower affidavit (Exhibit E2) containing a recapture tax notice.