finance
acceleration clause
An acceleration clause is a provision in a note or mortgage that lets the lender declare the entire remaining loan balance immediately due if the borrower defaults, such as by missing payments, failing to pay taxes, or letting insurance lapse. Without it, the lender could only sue for each missed payment. Acceleration is usually the first step before foreclosure.
- Exam tip
- Acceleration is triggered by default. Don't confuse it with the alienation clause, which makes the loan due when the property is sold.
- Example
- After a borrower misses four payments, the lender invokes the acceleration clause and demands the full $180,000 balance.
Related terms & state variants
Sources
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Last verified: 2026-10-23