In what scenario is a wrap-around mortgage most beneficial?

A wrap-around mortgage is most beneficial in the scenario of purchasing a property with existing financing. This type of financing involves the new mortgage encompassing the existing loan, allowing the buyer to make payments that cover both the original mortgage and the additional financing needed for the purchase.

This structure is advantageous for buyers who may not qualify for conventional financing due to various reasons, such as credit issues or insufficient funds for a large down payment. It also offsets the need to pay off the existing mortgage before transferring ownership, facilitating a smoother transaction for both the seller and the buyer.

In this situation, the buyer can assume the existing debt while taking on additional financing to complete the purchase, making it a practical solution in cases where a conventional loan might not be as easily accessible. The other scenarios described do not leverage the unique benefits that a wrap-around mortgage provides, which is primarily designed for cases involving existing loans.