due-on-sale clause
Definition
Provision in most conventional mortgage agreements that prevents a subsequent buyer of a property from assuming the mortgage at the original interest rate. Under this clause, the full balance on mortgage must be paid when the property is sold and the new owner must negotiate a new loan at new (usually higher) interest rates.
due-on-sale clause is in the Banking, Commerce & Finance and Real Estate & Buildings subjects.
due-on-sale clause appears in the definitions of the following terms: assumable mortgage and non-assumption clause
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