Finance
A Colorado mortgage that includes a 'due-on-sale' clause means:
AA. The borrower must sell within a specified time
BB. The full mortgage balance becomes due if the property is sold or transferred without the lender's consent✓ Correct
CC. The seller must pay off the mortgage at closing
DD. The buyer assumes the existing mortgage automatically
Explanation
A due-on-sale (or acceleration) clause requires the entire remaining loan balance to be paid when the property is sold or transferred. This prevents a new buyer from assuming the existing loan without lender approval. The Garn-St. Germain Act federally preempts state laws that would prevent lenders from enforcing due-on-sale clauses in most residential mortgages.
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