What is an assumable contract?

More context would help. Here is a general answer based on some assumptions. Assumable contracts when used for discussions involving US real estate are rare these days. What it means is the contact between a borrower and a lender can be assumed by another party who wants to take over for the borrower. That is not the legally precise definition but that was the market practice. VA and FHA were two areas were contracts (the loan) was assumable. For the most part any time someone wants to assume the existing contract the other side to the transaction (the lender in this example) will need to give prior approval. The contract might be assumable if a reasonable alternative borrower applies. It is not done all that much in residential. It can be found in the commercial real estate sector.