(8) Clauses In A Mortgage Flashcards

1
Q

Declares that if the mortgagor was to ever become delinquent in payments, that the entire balance of the mortgage note become immediately due and payable by foreclosing the property

A

Acceleration Clause

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2
Q

Demands full payment of the mortgage balance if the property is sold or the title transfers to a third party. This protects the lender from a third party with any credit risks

A

Alienation Clause (Due-on-Sale)

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3
Q

Usually written into the agreement permitting the lender to increase or decrease the agreed-upon-interest-rate

A

Escalation Clause

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4
Q

Usually used in junior or second mortgage to differentiate that a certain mortgage is subordinate to other(s). Allows first mortgage to be paid off first.

A

Subordination Clause

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5
Q

Terminates the rights of the lender when the debt is paid off

A

Defeasance Clause

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