- due-on-sale provision
USAA provision in a promissory note, loan or mortgage that allows the lender to demand payment of the full balance owed when the borrower sells or transfers real property used as security. This kind of clause is standard in mortgages executed in the US. However, major statutory exceptions to these provisions exist where a borrower transfers property to a trust to which the borrower is a beneficiary.
Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010.
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Due-on-sale clause — A due on sale clause is a clause in a loan or promissory note that stipulates that the full balance may be called due upon sale or transfer of ownership of the property used to secure the note. The lender has the right, but not the obligation, to … Wikipedia
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