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Assumable Mortgage Calculator
Free assumable mortgage calculator. Compare taking over a low-rate FHA or VA loan (plus financing the equity gap) against a new market-rate mortgage — monthly and lifetime.
How assumable-mortgage savings work
An assumable mortgage lets a buyer take over the seller's existing loan — keeping its interest rate and remaining term. Government-backed FHA and VA loans are generally assumable, and many were locked at 2–4% during 2020–2021. Taking one over instead of borrowing at today's rate can save a lot of interest.
The catch is the gap. The assumed balance is usually much smaller than the sale price, because the seller has built equity. The buyer must cover that difference:
gap to cover = home price − assumable balance
You can pay the gap in cash, finance it with a market-rate second loan, or both. This tool compares two scenarios using the standard mortgage payment formula:
monthly P&I = P × r(1+r)ⁿ ÷ ((1+r)ⁿ − 1), r = rate ÷ 12 ÷ 100, n = months
- Scenario A — Assume: low-rate P&I on the assumed balance for its remaining term, plus P&I on any market-rate second loan used to finance the gap.
- Scenario B — New loan: a single new market-rate loan for the home price minus the same cash down.
We report the monthly payment difference and the total lifetime interest of each path so you can see the real spread.
Estimates only — not financial/tax advice. Consult a professional. Excludes taxes, insurance, PMI, assumption and closing fees, and lender qualification.
Frequently asked questions
Which mortgages are assumable?
FHA, VA, and USDA loans are generally assumable with lender approval. Most conventional loans are not. The buyer still has to qualify with the servicer.
How does the buyer cover the gap between price and balance?
With cash, a second mortgage, or a mix. Because the seller's equity can be large, the cash or second-loan amount is often substantial — which is exactly what this calculator models.
Is assuming a mortgage always cheaper?
Not always. If a big gap has to be financed at today's market rate, the blended cost can approach a plain new loan. The savings are largest when the assumed balance is high relative to the price and the rate gap is wide.
Does the seller stay liable for the loan?
Usually the seller wants a release of liability so they're off the note. VA sellers should also confirm their entitlement is restored. Confirm details with the lender.