A generic term used by many
practitioners referring to funds required to
pay the purchase price in a real estate
transaction when the buyer is assuming an
existing mortgage on the property.
Cash to mortgage is often informally
referred to by practitioners when providing
buyers with a rough estimate of funds
required to purchase a property, but does
not represent an exact assessment of cash
required in order to close the transaction.
An accurate estimate requires, among other
things, detailed analysis of adjustments at
the point of closing.
Example
of Cash to
Mortgage
Investor McKay is
considering a residential property in
Anycity that is currently listed at $255,000
and has an assumable mortgage of $150,000.
The cash to mortgage amount is $105,000.
This amount does not include closing
adjustments and is only a rough estimate of
actual cash required to close a sale.
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