Question

Jim and Jane are buying a home for $120,000. They have $20,000 for a down payment and assumed the seller’s mortgage of $75,000. Jim and Jane financed the remaining $25,000 through the seller. What kind of a mortgage do they have?

Answer 1

Purchase-money mortgage

Step-by-step explanation:

According to the given conditions, the kind of mortgage they have is purchase-money mortgage.

The purchase-money mortgage is a kind of mortgage provided to the borrower by the seller of the property, when the situation arises like the buyer is not able to issue loans or mortgage from the traditional lending channels like banks etc.