Legal Question in Business Law in New Jersey

Thank you for your LawGuru question. It depends on what the loan agreements say. However, what you are describing is an "acceleration clause"---and they are fairly typical. Please contact me ASAP so that we may explore your options and protect your legal rights. 973-921-0600.

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Most commercial loans have an "acceleration" clause. This gives the Bank the right to demand the entire prinipal balance due in the event of a "default." Failure to timely pay is a default which typically triggers the acceleration clause.

I hope this helps!

Ron Cappuccio

856 665-2121

As a Franchise Attorney I agree with the other attorney answers. If there's a default in payment, most commercial loans have an acceleration clause that makes the entire amount due. Best to talk to your bank, explain your circumstances, and try to work something out. Consult with a good business or franchise attorney in your area for specific advice.

Mr. Franchise - Kevin B. Murphy, B.S., M.B.A., J.D.

Franchise Foundations, a Professional Corporation