Holdback

Definition

  • An amount of money withheld by the lender during the progress of construction of a house to ensure that construction is satisfactory at every stage. The amount of hold-back is generally equivalent to the estimated cost to complete construction.

Synonyms
retention fund

Related Terms and Acronyms

  • Construction Budget Definition,
    • Money that the builder sets aside for building a structure.
  • Construction Loan Definition,
    • A short-term interim loan for financing the cost of construction. The lender makes payments to the builder at periodic intervals as the work progresses.
  • Construction to Permanent Loan Definition,
    • A loan that finances the construction, then for a long-term, traditional mortgage, as distinct from a construction loan followed by a separate mortgage loan.
  • Lien Holdback Definition,
    • The practice of mortgagees withholding up to 15% of mortgage monies advanced on new construction.
  • Quantum Meruit Definition,
    • Used in contract law it means "reasonable value of services."
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