What is the term for a clause allowing a lender to demand loan repayment upon the sale of the property?

The term that appropriately describes a clause which allows a lender to demand repayment of a loan when the property is sold is known as an alienation clause. This type of clause is included in mortgage agreements and serves to protect the lender's interests by ensuring that they have the option to collect the full amount owed if the property changes hands.

When a property is sold, the lender may want to ensure that they are repaid immediately, rather than having the new owner continue with the existing loan terms. The alienation clause requires the borrower to either pay off the loan entirely when selling the property or seek the lender’s approval for the assumption of the loan by the new buyer. This helps to secure the lender's investment, as the original borrower may not be the same person responsible for the payment obligations after the sale.

The other terms, while related to finance and property transactions, do not specifically address the situation of a property sale triggering loan repayment. A prepayment clause deals with the ability to pay off a loan before it is due without penalty. An involuntary lien refers to a legal claim on a property due to debts that must be paid. An acceleration clause allows a lender to demand full repayment of a loan if a borrower defaults on the loan terms, but