If a borrower sells their property, what happens to their obligation under the mortgage?

When a borrower sells their property, their obligation under the mortgage typically remains intact unless there is a specific assumption agreement in place. This means that even after the sale, the original borrower continues to be responsible for repaying the mortgage, as the debt is tied to the borrower rather than the property itself.

In a sale where the buyer does not assume the mortgage, the lender retains the right to pursue the original borrower for repayment if the new owner defaults on the loan. An assumption agreement, however, would allow the buyer to take over the mortgage responsibility, effectively releasing the original borrower from their obligation. Without such an agreement, the original mortgage terms remain valid and binding on the borrower even after they no longer own the property. This principle serves as a critical aspect of mortgage law and real estate transactions.