Transfer of security and assumption of indebtedness.

CFR · 2024-01-01 · US · Title 7

(a) (b) (2) If a borrower transfers title to the security property with a due-on-sale clause without obtaining RHS authorization, RHS will not approve assumption of the indebtedness, and the loan will be liquidated unless RHS determines that it is in the Government's best interest to continue the loan. If RHS decides to continue the loan, the account will be serviced in the original borrower's name and the original borrower will remain liable for the loan under the terms of the security instrument. (c) (i) A transfer from the borrower to a spouse or children not resulting from the death of the borrower. (ii) A transfer to a relative, joint tenant, or tenant by the entirety resulting from the death of the borrower. (iii) A transfer to a spouse or ex-spouse resulting from a divorce decree, legal separation agreement, or property settlement agreement. (iv) A transfer to a person other than a deceased borrower's spouse who wishes to assume the loan for the benefit of persons who were dependent on the deceased borrower at the time of death, if the dwelling will be occupied by one or more persons who were dependent on the borrower at the time of death, and there is a reasonable prospect of repayment. (v) A transfer into an inter vivos trust in which the borrower does not transfer rights of occupancy in the property. (2) A transferee who obtains property through one of the types of transfer listed in paragraph (c)(1) of this section: (i) Is not required to assume the loan, and RHS i

official document · source cfr-2024 · id 7:§ 3550.163