Construction Loans
Definition of "Construction loans"
Also called interim financing. A mortgage that provides the funds necessary for the building or construction of a real estate project. The project can be a residential subdivision, a shopping center, an industrial park, or any other type of property requiring financing during the time required to complete construction. Normally, the full amount to be loaned is committed by the lender, but the actual disbursement is dependent upon the progress of the construction. Funds are sometimes distributed to the borrower in a series of draws, depending upon the work required by the lender. Another method used is for the developer to submit all bills to the lender, who in turn pays the bills. In either case, interest is paid on what has been distributed and not on the total amount to be borrowed.
Popular Real Estate Terms
The definition of restraint on alienation is a limitation on the right to convey or transfer owned real estate to another party. This restriction on conveying property has an effect that ...
Derogative term describing a high-pressure telemarketing office where sales personnel often use extremely exaggerated claims as well as intense sales practices to convince targets clients ...
Investment made rationally and intelligently as would be expected by a professional person. A reasonable degree of safety and return are expected. A example is an office building with 99% ...
Tax concept whereby income not actually received is considered to be constructively received by a taxpayer and thus must be reported. An example is a bond interest coupon. The interest is ...
Process by which a lessee rents his apartment to another. ...
The equity in property because of work in it by the buyer or holder which directly increases its value. ...
Market condition in which sellers exceed buyers, thereby causing prices to fall. In real estate, declining markets may result from unfavorable business conditions and high interest rates. ...
Enumeration of the consideration given by each party to a contract which in some cases must be in written form to be enforceable. For example, the statute of frauds requires that all ...
Assets owned by an individual as part of his or her estate except for land and everything attached to the land. Personal property may be either tangible, having physical substance such as ...
Have a question or comment?
We're here to help.