Can a Bank Demand Full Mortgage Repayment

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Updated on April 5, 2024 by
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When a bank demands full repayment of a mortgage, the most likely reason is that the person has fallen behind on payments. Sometimes this can happen for a number of reasons, including medical bills or unemployment. When this happens, the bank can often make things difficult for you.

They may try to scare you into paying them by sending letters demanding that you pay up immediately. This can be extremely stressful, and something that is likely to lead to poor financial decisions in the future. It can also cause problems with credit scores and can prevent you from getting future loans. Therefore, read this article to find out why banks may demand full mortgage repayments, so you can figure out how to avoid this outcome.

What Does a Full Mortgage Repayment Mean?

A full mortgage repayment is a situation where the bank wants to have all of the money that you owe them, all at once. They may want you to pay off the full amount of the mortgage, or they may just want you to pay the minimum payment. Whatever the case, they will want this money right away.

This can be incredibly stressful for people who have mortgages, and something that is unlikely to make you financially secure in the long run.

Reasons Why a Bank Can Ask for Full Mortgage Repayment

There are a number of reasons why a bank may ask for full mortgage repayments. The most common reasons are as follows:

Late payments

If you have fallen behind on payments, the bank may want to close your account and make you pay off the full amount of the mortgage. Some states allow delinquent borrowers to get the money they owe back by a set deadline.

This could be, for example, one business day before their home is officially sold off. If there’s no state law that specifically gives a right to reinstate the loan, many mortgages and deeds of trust give borrowers a time limit to pay it back if they fail to make the payment on time.

Missing out on property taxes

Some states will not let you get your home back if you fall behind on property taxes. This is especially true if the home has been sold, as this means that the bank will have received a full payment for the property. Property taxes are normally due on the first of the month, and if you miss out on them, the bank will often be able to get your home back and demand that you repay the mortgage in full. This is also often called “acceleration”.


A bank may also want to close your account if you have filed for bankruptcy. They may not want to lend money to someone who has been declared bankrupt, and so they will often seek to recover their money from you in the event that you are declared bankrupt.

If you declare bankruptcy, your loan will be accelerated. This will allow your lenders to take action against you as soon as you become unable to pay. It may be that filing for bankruptcy may cause your lender to lose their right to enforce its rights if you default on your payments.

Removal of Homeowners Insurance

When homeowner’s insurance is removed for any reason, the bank may demand full mortgage repayment.

Most mortgage agreements require homeowners to maintain homeowner’s insurance policies, which protect the property. However, removing the policy can be considered a breach of the mortgage agreement.

Unauthorized Property Transfers

If a property is transferred to another owner without the approval of the lender, this is considered an unauthorized property transfer. Such a transfer can cause a lender to demand full mortgage repayment.

How to Avoid a Bank Demanding Mortgage Repayment

There are several ways to avoid a bank demanding mortgage repayment. These methods can also help you avoid foreclosure if you’re not able to keep up with your mortgage payments:

Mortgage assistance: if you’re having a hard time keeping up with mortgage payments, don’t wait. It’s best to apply for mortgage assistance. You may qualify for different options offered under this program.

Communication: read all communications from the lender carefully. These could include important information that requires you to act. For instance, a lender may notify you that an unauthorized property transfer has taken place, and you may have the chance to correct this issue.

Options if You’re Faced with Full Mortgage Repayment

The chance of facing a foreclosure of your property is less than pleasant and there may be some options available to consider:

Refinancing: if you have enough equity in your home, it may be possible to refinance to reduce your monthly payments.

Forbearance: if you’re having trouble keeping up with your mortgage payments and can’t pay what you owe, it’s best to talk with the lender right away. Ask if you qualify for forbearance. Forbearance temporarily stops your payments.

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