Are Demand Features Common in Mortgage Loans?

Are demand features common in mortgage loans? The short answer is no — the Consumer Financial Protection Bureau (CFPB) states plainly that most mortgage loans do not have a demand feature. This article explains what a demand feature is, where it appears on your Closing Disclosure, which loans this applies to, and what to do if the box is checked “yes.” It is written for Colorado borrowers reviewing closing documents before signing.

Here are the key facts up front:

• A demand feature permits the lender to require early repayment of the loan.
• If it applies, the lender can require that you immediately pay the entire loan balance — principal and interest — at or after the date set forth in the loan documents.
• The lender can make this demand for any reason or for no reason.
• Most mortgage loans do not have a demand feature.
• The Closing Disclosure has a statement reading “Your loan has a demand feature,” checked “yes” or “no.”

Are demand features common in mortgage loans?

Demand features are the exception, not the rule. The CFPB’s own consumer guidance says most mortgage loans do not have a demand feature, so the typical borrower closing on a home in Colorado Springs will see the box checked “no.”

That said, the disclosure exists precisely because a demand feature occasionally does appear in a loan agreement. When it does, the stakes are significant, because a demand feature changes who controls the timeline of repayment.

So even though the answer to “are demand features common in mortgage loans” is no, you should still verify the box on every loan you sign. The next section explains exactly what you are verifying.

What a demand feature means on the Closing Disclosure

The Closing Disclosure includes a statement that reads “Your loan has a demand feature,” which is checked either “yes” or “no.” A demand feature — sometimes called a demand clause — permits the lender to require early repayment of the loan.

If the demand feature is checked “yes,” the lender can require that you immediately pay the entire loan balance, meaning principal and interest, at or after the date set forth in the loan documents. The lender can make this demand on you for any reason or for no reason.

That is very different from a normal mortgage, where you repay through scheduled monthly payments over the life of the loan. With a demand clause in place, keeping current on monthly mortgage payments does not by itself protect you from a call for full repayment of the remaining balance.

The CFPB’s advice is to check both your Closing Disclosure and your promissory note for any demand features. The disclosure summarizes the loan; the note is the loan document you are actually bound by, so review both before signing.

Knowing what the demand feature box means is step one — step two is knowing whether your loan even comes with a Closing Disclosure to check.

Which loans get this disclosure — and which do not

The Closing Disclosure and the Loan Estimate apply to standard mortgage loans. The CFPB notes that you will not receive a Loan Estimate or Closing Disclosure if you are shopping for a reverse mortgage, a home equity line of credit (HELOC), a manufactured housing or mobile home loan not secured by real estate, or a subordinate loan through certain types of homebuyer assistance programs.

For those kinds of loans, you should receive Truth-in-Lending disclosures instead. If you are shopping for a reverse mortgage, you will also receive a Good Faith Estimate (GFE) and a HUD-1 Settlement Statement.

The practical takeaway for a borrower: on a standard purchase or refinance mortgage, the demand feature question is answered right on the Closing Disclosure. On the loan types listed above, you need to read the Truth-in-Lending disclosures and the loan documents themselves to understand the repayment terms.

Once you know where to look, the next question is what to do if you actually find a demand feature.

What to do if the demand feature box is checked “yes”

The CFPB lays out three options. Think carefully about whether you want to agree to a demand feature, ask for it to be removed, or seek out another mortgage lender.

None of those is automatic. A demand feature hands the lender the power to require payment of the entire loan balance on the lender’s timeline, so you should understand exactly what you are agreeing to before signing — and ask questions until the answer is clear.

This matters in a military market like Colorado Springs, where PCS moves already add moving parts to homeownership plans. A loan whose entire balance can be called at the lender’s discretion deserves a hard look before you commit, and an attorney can review the promissory note if anything in the loan documents is unclear.

If you have a problem with your mortgage after closing, the CFPB says to talk with your lender immediately. You can also submit a complaint to the CFPB online.

If you are still shopping, the simplest protection is comparing offers before you pick one — which is exactly how the application process is designed to work.

Next steps for Colorado borrowers

The CFPB recommends requesting a Loan Estimate from three or more lenders so you can compare options and choose the loan that fits you. Getting a Loan Estimate requires only six key pieces of information: your name, your income, your Social Security number, the property address, an estimate of the home’s value, and the loan amount you want to borrow.

Then read every disclosure, including the demand feature statement, before you sign. If you want a second set of eyes on a Closing Disclosure or you are starting a purchase or refinance along the Front Range, talk with a 719 Lending loan officer and walk through the loan documents line by line before closing day.

Frequently asked questions

Do most mortgage loans have a demand feature?

No. The Consumer Financial Protection Bureau states that most mortgage loans do not have a demand feature. Still, check the Closing Disclosure and the promissory note on every loan, because the disclosure exists for the cases where a demand feature does appear.

What happens if the demand feature is checked “yes” on my Closing Disclosure?

If the demand feature is checked “yes,” the lender can require that you immediately pay the entire loan balance — principal and interest — at or after the date set forth in the loan documents. The lender can make this demand for any reason or for no reason.

Where do I find out if my loan has a demand feature?

Look at the Closing Disclosure, which contains a statement reading “Your loan has a demand feature,” checked “yes” or “no.” Also review the promissory note itself, since that is the loan document that binds you.

Can I ask for a demand feature to be removed?

Yes. The CFPB says to think carefully about whether you want to agree to a demand feature, ask for it to be removed, or seek out another mortgage lender before signing.

Which loans do not come with a Closing Disclosure?

Per the CFPB, you will not receive a Loan Estimate or Closing Disclosure for a reverse mortgage, a HELOC, a manufactured or mobile home loan not secured by real estate, or a subordinate loan through certain homebuyer assistance programs. Those loans come with Truth-in-Lending disclosures instead.

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719 Lending Inc. is not affiliated with or endorsed by HUD, FHA, VA, USDA, CHFA, the CFPB, or any government agency.

Last updated: October 2026