An acceleration clause is part of the standard mortgage agreement used by Fannie Mae and is the contract used in many residential mortgages.

Even if your mortgage is not backed by Fannie Mae, most lenders have some form of acceleration clause.

If you comply with your mortgage contract and pay your monthly bills and other fees on time, you will avoid triggering this acceleration clause.

However, if you violate any of the terms in your contract, be aware.

If any of the terms in the loan agreement are not met, the holder of the mortgage has the right to repossess the loan.

The most common reason for a lender to accelerate a mortgage is when the borrower fails to make monthly mortgage payments.

However, most mortgages also allow for acceleration if another part of the contract has been breached.

Other common covenants that may trigger an acceleration include the following

Failure to purchase homeowner's insurance - or to keep it up to date.

Failure to pay property taxes, or being late in paying property taxes.

Failure to maintain the home in a livable condition.

Attempting to transfer the property without the lender's approval.

Every mortgage contract is different, so be sure to read your contract carefully to understand what will trigger your acceleration clause.

Generally, there will be a letter notifying the borrower that the lender has triggered the acceleration clause.

The letter will give the amount due, including the loan balance, and any unpaid interest. The letter will also include the date by which you must pay.

Typically, this will be within 30 days of receiving the letter.

If you cannot pay, the lender will proceed to the next step: foreclosure, where the lender takes over ownership of your home to try to recover its costs.

Lenders don't necessarily have to accelerate your loan to foreclose on your home, but often do.

It's a form of a last chance to make payments before the foreclosure process begins."

What can you do if your mortgage is accelerated?

It's important to note that even if your mortgage is accelerated, you can still avoid foreclosure, which doesn't mean that there aren't other options available.

Often, you can work with your lender to resolve the issue and reinstate your mortgage.

This may mean making missed payments (including interest) or fixing any problems that caused the lender to foreclose.

Sometimes your lender will also restructure your loan, called a loan modification, so that your payments are reduced to make it affordable.

Each servicer has their own specific modification guidelines, but they may extend the term of your loan, lower your interest rate, or propose a deferred repayment plan that works for both parties.