Which clause in a mortgage permits the lender to demand the full repayment of the loan amount?

The clause that permits the lender to demand the full repayment of the loan amount is known as the acceleration clause. This provision allows the lender to "accelerate" the loan, meaning that if the borrower defaults on the terms of the mortgage (such as failing to make payments), the lender has the right to require the entire unpaid balance of the loan to be paid immediately. This serves as a protective measure for lenders, ensuring that they can recover their funds swiftly if there is a breach of the loan agreement.

Acceleration clauses are commonly included in both residential and commercial loan agreements and are a vital component of mortgage contracts. The immediate demand for payment can help mitigate losses for the lender when a borrower fails to maintain the terms of the mortgage.