What can a seller do to protect himself from future liability when a buyer assumes a mortgage?

When a buyer assumes a mortgage, the seller's liability can potentially continue unless specific steps are taken to safeguard against it. The correct action for protecting oneself from future liability in this situation is for the seller to ensure that the buyer properly assumes the mortgage.

By having the buyer officially assume the mortgage, the buyer becomes responsible for the mortgage payments and the obligations tied to the loan. This process typically involves the lender reviewing the buyer’s creditworthiness and accepting them as the new debtor. When the assumption is executed correctly, it helps diminish the seller's risk, as the lender may release the seller from future liability related to that mortgage.

The other options do not provide the same level of protection. Terminating the mortgage agreement is not feasible, as the mortgage would need to be paid off instead. Simply selling the property without a mortgage does not address the situation if there is an existing mortgage; it may involve additional complications or costs. Notifying the lender of the sales agreement involves communication but does not ensure that the seller is protected from liability unless the buyer's assumption is confirmed and approved by the lender. Thus, the focus on ensuring that the mortgage is assumed is the best course of action for the seller.