Acceleration Clause Legal Meaning and Definition

Here is a simplified definition of the legal term Acceleration Clause.

Acceleration Clause (noun)

An Acceleration Clause is a contract stipulation that allows a creditor to demand the full repayment of an outstanding balance from a debtor upon the occurrence of a specific event, such as a missed payment or violation of other contract terms. This clause is common in mortgage or real estate contracts, where if an installment is unpaid by the due date, the creditor can require the entire unpaid amount to be paid immediately, instead of in future installments.