Assumption after loan modification?

[Cameron Tope]

Fellow investors,

Has anyone assumed a loan after a modification has been completed? The loan mod was early this year due to the sellers falling behind on their payments. After the loan mod HUD tacked a 33k lien onto the mortgage. I'm wondering if I have to pay that off before assuming? I have closed deals where I had to pay off any secondary liens but this HUD lien is attached to the mortgage.

Any advice from someone who has successfully assumed loans like this would be great!

Thanks in advance.

Cam

[Brett Goldsmith]

Did HUD place the arrearage back into the loan via capitalization? HUD generally records a silent 2nd lien called a partial claim for the arrearage. Have you already checked title?

If the loan was capitalized you'd just assume the new current UPB. From from my experience with partial claims, I'd lean towards them wanting that paid in full prior to any 1st lien assumption, but I could be wrong as I've never done it.