Alienation clause

What does Alienation clause mean in American Law?

The definition of Alienation clause in the law of the United States, as defined by the lexicographer Arthur Leff in his legal dictionary is:

In insurance parlance, especially in fire insurance and similar policies, a clause which renders the policy void if the property, or the insured person’s interest in it, is alienated, i.e., transferred to someone else, without the insurer’s consent. The idea, of course, is that some property owners are more risky to insure against fire, etc. than others. See moral hazard.

Also, in real property talk, a clause in a mortgage permitting the lender to demand payment of the total outstanding mortgage upon transfer of the mortgaged property.

Concept of Alienation Clause in the context of Real Property

A short definition of Alienation Clause: A type of acceleration clause, calling for a debt under a mortgage or deed of trust to be due in its entirety upon transfer of ownership of the secured property. Also called a “due-on-sale” clause.

Concept of Alienation Clause in the context of Real Property

A short definition of Alienation Clause: A type of acceleration clause, calling for a debt under a mortgage or deed of trust to be due in its entirety upon transfer of ownership of the secured property. Also called a “due-on-sale” clause.