What type of clause enables non-judicial foreclosure in a mortgage or trust deed?

The Power of Sale clause is instrumental in enabling non-judicial foreclosure in a mortgage or trust deed. This clause grants the lender the authority to sell the property in the event of default without having to go through the court system. This process is typically faster and less expensive compared to judicial foreclosure, as it avoids the need for legal proceedings.

In states where the Power of Sale clause is utilized, the lender can initiate foreclosure by providing notice to the borrower and others interested in the property, followed by the sale of the property at a public auction. This efficiency is beneficial for both lenders, who can recover their investments more swiftly, and for borrowers, who may avoid prolonged legal battles.

The other choices do not specifically facilitate non-judicial foreclosure in the same way. For example, while an acceleration clause may require the borrower to repay the entire loan balance upon default, it does not by itself permit a non-judicial sale. Similarly, the due on sale clause focuses on the lender's right to call the loan due if the property is sold, and a subordination clause relates to the priority of debts rather than the foreclosure process itself. Therefore, the Power of Sale clause stands out as the defining feature that allows for non-judicial foreclosure.