Which statement best describes the buyer's situation with a "subject to" mortgage agreement?

In a "subject to" mortgage agreement, the buyer takes over the property while the existing mortgage remains in the seller's name. This means that the lender is not directly involved in the transaction and has not formally approved the buyer as the new borrower. In the event of foreclosure, the buyer is not personally obligated to pay the remaining loan balance to the lender because the lender's agreement is still with the original borrower (the seller).

This situation allows the buyer to take possession of the property without formally assuming the mortgage loan. However, it's important to note that the original borrower (the seller) remains responsible for the mortgage payments. If the payments are not made, the lender can pursue foreclosure against the seller, not the buyer. Therefore, if a foreclosure occurs, it would be the seller's credit that is impacted, not the buyer's directly. This key aspect underscores why the buyer is not legally bound to pay the lender in the case of foreclosure; their obligation is instead contingent on the agreement they have with the seller.

The other options do not describe the nuances of a "subject to" agreement accurately. The buyer is not fully responsible for the mortgage in the traditional sense, as the loan remains the seller’s obligation. Additionally, while the buyer