When a buyer agrees to assume the mortgage on a property, this typically means that the buyer takes on the obligation to repay the remaining balance of the mortgage debt. The important aspect here is that the original homeowner, or seller, remains liable for the mortgage in addition to the buyer. This creates a situation where both the homeowner and the buyer are jointly and severally liable for the debt.
Joint and several liability means that the lender can pursue either party for the full amount of the debt. If the buyer fails to make payments, the lender has the right to seek recovery from the original homeowner as well. Thus, this arrangement creates a continued financial responsibility for the seller despite the sale of the property.
This understanding of liability is critical in real estate transactions, especially in the context of mortgages, as it protects the lender's interests by ensuring that there are multiple parties accountable for the mortgage obligation.