What is the implication when a buyer agrees to assume the mortgage?

When a buyer agrees to assume the mortgage, they effectively take on the responsibility for repaying the loan associated with that mortgage to the lender. This means that the buyer becomes personally liable for the mortgage debt. By assuming the mortgage, the buyer is not merely agreeing to make payments; they are legally obligated to ensure that the debt is satisfied. This assumption can create a direct contractual relationship between the buyer and the lender regarding the mortgage debt.

In this scenario, if the buyer defaults on the loan, the lender can pursue them for the outstanding balance, reflecting the buyer's liability for the debt. Such a situation contrasts with other arrangements, such as a "subject to" agreement, where the buyer takes title without formally assuming the mortgage and the original owner remains liable to the lender. The present option correctly highlights the buyer's new responsibility and aligns with common real estate practices regarding mortgage assumption.