Business and Personal Finance Dictionary

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• POWER-OF-SALE CLAUSE
  
  A clause in a mortgage authorizing the holder of the mortgage to sell the property in the event of the borrower's default. The prodeeds from the public sale are used to pay off the mortgage debt first, and any surplus is paid to the mortgagor. A power-of-sale clause is also found in trust deeds, giving the trustee authority to sell the trust property under certain circumstances.
  
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