Due-on-Sale Clause
Definition of "Due-on-Sale Clause"
A provision of a loan contract stipulating that if the property is sold the loan balance must be repaid. A mortgage containing a due-on-sale clause is not assumable. This prevents a home seller from transferring responsibility for an existing loan to the buyer when the interest rate on the old loan is below the current market.
Popular Mortgage Terms
A request for a loan that includes the information about the potential borrower, the property and the requested loan that the solicited lender needs to make a decision. In a narrower sense, ...
On an ARM, the assumption that the value of the index to which the interest rate is tied does not change from its initial level. ...
A contract provision that adjusts the payment on an ARM periodically to make it fully amortizing. ...
A documentation option where the applicant's income is disclosed and verified but not used in qualifying the borrower. The conventional maximum ratios of expense to income are not ...
Interest from the day of closing to the first day of the following month. To simplify the task of loan administration, the accounting for all home loans begins as if the loan was closed ...
A mortgage Web site designed to provide leads to lenders. A 'lead' is a packet of information about a consumer in the market for a loan. Lenders pay for leads, and these sites are an ...
The lowest interest rate possible under an ARM contract. Floors are less common than ceilings. ...
USDA loans are a form of government-backed financing for both first-time home buyers and move up buyers looking for a second or third property. These loans have little to do with ...
One of many interest rate indexes used to determine interest rate adjustments on an adjustable rate mortgage. ...
Have a question or comment?
We're here to help.