What do you call the process of transferring the rights and obligations under a mortgage from one person to another?

The process of transferring the rights and obligations under a mortgage from one person to another is known as an assignment. In this context, an assignment involves the original borrower transferring their interest in the mortgage and the associated responsibilities to a new borrower. This process allows the new borrower to step into the shoes of the original borrower, which means they will be responsible for making payments and adhering to the terms of the mortgage.

Assignments are a common practice in real estate transactions, as they help facilitate the transfer of obligations without needing to create a completely new mortgage agreement. For a valid assignment to occur, the lender typically needs to approve the transfer, ensuring that the new borrower meets the lender's requirements.

While terms like "transfer" and "novation" might seem similar, they have distinct meanings in legal and real estate terminology. A transfer can refer more generally to any movement of assets, not specifically tied to the obligations of a mortgage. Novation, on the other hand, involves replacing one of the parties in a contract with the consent of all parties involved, creating a new obligation. Reassignment is not a standard term used in this context and does not accurately describe the process. Thus, assignment is the precise term for this scenario.