A "due-on-sale clause" is a part of a loan agreement that allows a lender to demand the loan to be paid back in full if the owner of the property transfers any interest in the real estate. This can be done, for example, if the property is sold. However, there are exceptions for transfers made between family members, such as when a home is passed down to a relative.
These are questions that the above text answers:
1. What is a due-on-sale clause in a loan agreement?
2. When can a lender demand a loan to be paid back in full?
3. What triggers a due-on-sale clause?
4. Are there any exceptions to the due-on-sale clause?
5. What type of transfers are exempt from the due-on-sale clause?
6. Can a property owner transfer any interest in the real estate without triggering the due-on-sale clause?
7. What is an example of a transfer that could trigger the due-on-sale clause?
8. Are there any circumstances where a due-on-sale clause would not apply?