Dunham v. Ware Savings Bank

The facts of this case are simple, but it will likely have significant impact upon many transactions involving the sale of real property. We decide a question recently presented to a number of courts in the United States, namely, whether the enforcement of a so called “due-on-sale” clause 3 in a home mortgage constitutes an unreasonable restraint on alienation in the absence of allegations of impairment to the security. A due-on-sale clause is a device commonly used in real property security transactions to provide, at the option of the lender, for acceleration of the maturity of the loan…