A builder who does not want to pay off the entire loan balance upon selling a single home should ensure their mortgage includes what feature?

The correct answer is the release clause, which is a specific provision within a mortgage contract allowing a borrower to release individual properties from the mortgage obligation under certain conditions, typically after a specified payment is made. This is particularly advantageous for builders or developers who may be selling multiple homes but do not want to pay off the entire loan for all properties sold until the loan matures.

By including a release clause, the builder can sell individual homes and release them from the mortgage without needing to settle the entire debt, thus managing cash flow and the sale process more effectively. This flexibility is crucial for builders who often operate on tight timelines and need to reinvest funds quickly into new projects.

Other features like a prepayment penalty would have adverse effects for a builder in this scenario, as it would incur extra charges when trying to pay off part of the loan early. A variable rate clause pertains to interest rate adjustments and does not influence the ability to sell properties individually. A balloon clause refers to a loan that requires a large final payment, which does not align with the builder's goal of selling homes without full loan satisfaction immediately.