Loan Stacking Prohibited Clause Samples
The "Loan Stacking Prohibited" clause serves to prevent a borrower from taking out multiple loans from different lenders at the same time without disclosure or approval. In practice, this clause typically requires the borrower to confirm that they have not and will not obtain additional loans that could affect their ability to repay the current loan. By prohibiting loan stacking, the clause helps protect the lender from increased credit risk and ensures that the borrower's financial obligations remain manageable, thereby reducing the likelihood of default.
Loan Stacking Prohibited. The Lender prohibits “loan stacking”, which means any series of transactions occurring within a ninety- (90-) day period, during which Obligations under the Agreement are outstanding, in which the Borrower maintains loans from three or more lenders in addition to the Lender, unless the Lender has given prior written consent to the Borrower to exceed such number of loans. The Borrower acknowledges and agrees that any occurrence of loan stacking as defined in this Section 4(c) shall be an Event of Default under the Agreement, and Lender, at its option, shall have the right thereafter to cease making Loans under the Agreement, and to declare an Event of Default as to all outstanding Loans, which shall then become immediately due and payable, without demand or presentment to the Borrower, which are expressly waived by the Borrower. Without limiting the foregoing, the Lender may immediately exercise all rights, powers and remedies available to it under the Agreement, at law, in equity or otherwise. The Lender reserves the right to change the loan stacking policy set forth in this Section 4(c) with respect to any Loan Request by including the updated policy in the Loan Information in the Borrower Dashboard.