If Ivy gives a wraparound mortgage, which clause may require her to repay her initial loan?

In a wraparound mortgage, the alienation clause is a significant consideration because it pertains to the transfer of property ownership. This clause typically prohibits the borrower from transferring their interest in the property without the lender's consent. When Ivy provides a wraparound mortgage, she continues to pay her original loan while the new borrower makes payments to her for the larger mortgage, which includes her existing mortgage.

If an alienation clause is present in Ivy’s original mortgage, it would require her to pay off that initial loan if she transfers the property or if the new borrower attempts to assume the original loan without adhering to the terms outlined in that clause. The purpose of the alienation clause is to protect the lender from having a mortgage assumed by another party without their agreement, ensuring that Ivy remains liable for her original loan unless she manages to refinance or pay it off entirely.

The other clauses have different functions. For instance, the acceleration clause allows the lender to demand full payment of the loan if certain conditions are met, such as default. The defeasance clause indicates that the borrower retains the right to redeem the property once the mortgage is paid off. The power of sale clause grants the lender the authority to sell the property in case of default without going through court procedures.