Finance
Under Montana law, a 'due-on-sale clause' (acceleration clause) in a deed of trust allows the lender to:
AReduce the interest rate when the property is sold
BRequire the full loan balance to be paid when the property is transferred✓ Correct
CRequire only the new owner to assume the loan without qualification
DAutomatically extend the loan term when the property is sold
Explanation
A due-on-sale clause allows the lender to demand full repayment of the loan when the property is sold or transferred. This prevents buyers from automatically assuming loans without lender approval.
Related Montana Finance Questions
- The Dodd-Frank Act created the Consumer Financial Protection Bureau (CFPB) to:
- A Montana homeowner has a home equity line of credit (HELOC). This type of financing is characterized by:
- In Montana, a deed of trust is used instead of a mortgage because it allows for:
- Discount points paid at loan origination are used to:
- When a lender requires the borrower to pay a portion of annual property taxes each month into an escrow account, this practice is called:
- Private mortgage insurance (PMI) is typically required when:
- A VA loan benefit is available to:
- Under RESPA (Real Estate Settlement Procedures Act), kickbacks between settlement service providers are:
Practice More Montana Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Montana Quiz →