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Acceleration Clause

Acceleration clauses are terms in loan agreements that require the borrower to pay off the loan immediately if certain conditions are met.

Many property mortgages have an acceleration clause that is triggered if the borrower misses too many payments.

For example, a borrower who fails to make a payment or who breaks a covenant may be required to pay the lender the balance on a loan.

In this case, the borrower is considered in breach of contract.

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Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au