| A contract provision that allows a lender to demand full repayment of a loan if certain conditions are met. |
- Mortgages and Real Estate Loans:
- “The mortgage agreement includes an acceleration clause, which means if the borrower misses a payment or violates other loan terms, the lender can demand full repayment of the remaining loan balance immediately.”
- Commercial Loans:
- “In many commercial loan agreements, an acceleration clause is triggered if the borrower defaults or the business enters bankruptcy, allowing the lender to accelerate the repayment timeline.”
- Student Loans:
- “Some private student loans contain an acceleration clause that activates if a borrower files for bankruptcy, which would require them to pay the loan balance in full rather than continuing with regular payments.”
- Auto Loans:
- “An acceleration clause in an auto loan can result in the lender demanding the entire outstanding amount if the borrower misses too many payments or fails to maintain required insurance.”
- Personal Loans:
- “If a borrower fails to meet specific loan conditions, such as providing updated financial documents, an acceleration clause in the loan agreement may allow the lender to demand immediate full repayment.”
Acceleration Clause might be used in different contexts:
