Where a property is sold subject to favorable existing debt, the buyer may seek to assume the loan rather than refinance.

The loan documents govern. Most permit a one-time transfer and assumption subject to conditions: lender approval of the transferee, an assumption fee, a replacement guarantor meeting net worth and experience tests, updated title and survey, an endorsement to the title policy, and legal opinions.

Underwriting. The lender re-underwrites the buyer as though originating, including credit, experience, and the single purpose entity structure.

Securitized loans. Where the loan has been securitized, approval runs through a servicer with limited discretion and defined criteria, and rating agency confirmation may be required. Timelines are long and should be built into the purchase agreement.

Release of the seller. Whether the original borrower and guarantor are released is negotiated and is the seller’s principal concern.

Due on sale and due on encumbrance. Transfers, including changes in the ownership of the borrower above thresholds, trigger acceleration absent consent. Structuring around them without consent risks a default.

Alternatives. Defeasance or yield maintenance to prepay, which carries substantial cost, or a seller carryback structure — each of which should be priced before the purchase agreement fixes the terms.