Texas Real Estate State Practice Exam 2025 – 400 Free Practice Questions to Pass the Exam

In Texas real estate, a "subject to assumption" condition indicates that when a property is sold, the buyer is acquiring the property along with an existing mortgage, but they are not taking personal responsibility for the repayment of that loan. The original owner remains obligated to the lender for the mortgage payments.

This situation often arises when a buyer wants to purchase a property with an existing loan that may have favorable terms, such as a low interest rate. By agreeing to the "subject to assumption," the buyer can benefit from those existing loan terms without officially assuming the debt or being liable to the lender.

It's important for buyers in this scenario to understand that while they can occupy the property and potentially make payments to the original owner, they are not the ones legally responsible for the debt in the eyes of the bank or lender. This distinction can significantly impact the buyer’s financial obligations and choices regarding the property.