MD SB689

Banking institutions, credit unions, and mortgage lenders must include provisions in conventional home mortgage loans allowing an existing borrower to assume the other borrower's portion of the mortgage in connection with an absolute divorce decree, if the assuming borrower qualifies for the loan

Lenders must disclose the assumption provision in writing to loan applicants before the loan application is completed

The requirement applies only to conventional home mortgage loans not already required by state or federal law to be assumable in divorce situations, and excludes federally insured or guaranteed loans (FHA, VA, etc.)

The assumption provisions apply retroactively to existing conventional mortgages that exceed Federal Housing Finance Agency lending limits, deeming them to include the assumption provision for divorces occurring on or after the effective date

Effective October 1, 2025; signed by Governor Wes Moore on April 22, 2025