Final answer:
In Georgia, the lender includes a Due-on-Sale Clause in the Security Deed to prevent a future purchaser from assuming the loan.
Step-by-step explanation:
In Georgia, when a lender wants to prevent a future purchaser of the property from being able to assume the loan, they typically include a Due-on-Sale Clause in the Security Deed.
The Due-on-Sale Clause states that if the property is sold or transferred to a new owner, the lender has the right to demand full repayment of the loan immediately. This clause prevents the new owner from assuming the loan and transfers the responsibility of the loan repayment to them.
For example, if the original borrower sells the property to a buyer, the Due-on-Sale Clause would require the buyer to obtain new financing and pay off the existing loan, rather than assuming the loan.