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Loan Assumption Agreement Sample

A loan assumption agreement is a document that outlines the terms and conditions of the transfer of a loan from one party to another. This type of agreement can be useful for a number of reasons, such as when the original borrower needs to transfer the loan to a new borrower due to a change in circumstances, or when a new buyer is interested in assuming the existing mortgage on a property.

If you are in need of a loan assumption agreement, it can be helpful to review a sample document to get an idea of what should be included. Here is a brief overview of what you can expect to find in a loan assumption agreement sample.

Overview and Purpose

The first section of a loan assumption agreement should provide a brief overview of the purpose of the agreement. This section should explain who the involved parties are, why the loan is being transferred, and what the terms of the transfer are.

Terms and Conditions

The next section of the agreement should outline the specific terms and conditions of the loan assumption. This should include details such as the amount of the loan, the interest rate, the duration of the loan, and any fees or penalties associated with the transfer.

Representations and Warranties

In a loan assumption agreement, the borrower will typically make representations and warranties to the new lender or borrower. These representations and warranties are statements about the borrower`s financial situation, creditworthiness, and ability to repay the loan. They are designed to provide assurance to the new lender or borrower that the loan is a good risk.


The indemnification section of a loan assumption agreement outlines who is responsible for any losses or damages that may arise as a result of the loan transfer. This section may also specify the types of losses that are covered and the amount of damages that can be recovered.

Default and Remedies

Finally, the loan assumption agreement should include a section on default and remedies. This section outlines the consequences of defaulting on the loan, as well as the remedies available to the lender or borrower in the event of a default.


If you are considering a loan assumption agreement, it is important to review a sample document to get a sense of what to expect. Make sure to carefully review all of the terms and conditions of the agreement before signing, and consider consulting with a legal professional if you have any questions or concerns. By taking these steps, you can ensure that you are entering into a loan agreement that is fair and beneficial for all parties involved.

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