If a banker requires the current loan on a business to be paid at the time of the sale to the new owner,the banker will require a due-on-sale clause in the agreement.

Question

Quizplus · Accepted Answer

A due-on-sale clause allows the lender to demand payment of the loan balance in full when the property securing the loan is sold or transferred to a new owner, making it a common requirement for bank loans on businesses or properties.

If a Banker Requires the Current Loan on a Business