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
Limit on the size of payment change on an adjustable rate mortgage. ...
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An interest rate index that is used on some ARMs. ...
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A mortgage lender or mortgage broker. ...
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