Finance
What is a 'due-on-sale' clause in a mortgage?
AA clause requiring the seller to pay off the loan at closing
BA clause allowing the lender to demand full loan repayment if the property is transferred without lender consent✓ Correct
CA clause reducing the interest rate when the property is sold
DA clause requiring PMI until the property is sold
Explanation
A due-on-sale (acceleration) clause gives the lender the right to demand full repayment of the loan balance when the property is sold or transferred without the lender's approval. This prevents buyers from assuming loans without lender consent.
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