Must all mortgage transaction disclosures state whether an obligation is assumable by subsequent purchasers?

All mortgage transaction disclosures are required to clearly state whether an obligation is assumable by subsequent purchasers in accordance with the Truth in Lending Act (TILA) and Regulation Z. This requirement is in place to ensure transparency for borrowers, enabling them to understand the terms of their mortgage and the implications for future buyers.

When a mortgage is assumable, it means that a subsequent purchaser can take over the remaining payments on the loan under the existing terms, which can be a beneficial feature for both sellers and buyers. By including this information, lenders provide essential details that can influence consumer decisions and the overall transaction process.

The other options do not align with the requirements set forth by Regulation Z. Stating that it is optional or only applicable to certain loans fails to acknowledge the comprehensive nature of the disclosure requirements. Furthermore, implying that the disclosure only needs to state the interest rate overlooks the broader set of information that must be conveyed to consumers for informed decision-making.