Finance
A 'due-on-sale' clause in a New Mexico mortgage or deed of trust:
AAllows the buyer to assume the existing loan
BRequires the full loan balance to be paid upon sale or transfer of the property✓ Correct
CWaives the prepayment penalty
DConverts the loan from fixed to adjustable rate upon sale
Explanation
A due-on-sale (alienation) clause requires the borrower to pay off the remaining loan balance when the property is sold or transferred. This prevents buyers from assuming the seller's below-market-rate loan without lender approval.
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