Tri-Party Agreement

AAA

DEFINITION of 'Tri-Party Agreement'

A business agreement between three separate parties. In the mortgage industry, a contract involving the buyer, the primary lender plus a construction lender. This type of contract is commonly used to secure bridge loans for the construction of a home or other real estate.

INVESTOPEDIA EXPLAINS 'Tri-Party Agreement'

Tri-party agreements extend credit for construction to the buyer from the construction provider. The provider in turn holds the property as collateral. The primary lender will then pay off the construction loan and assume full liability for the loan upon completion of the construction.

RELATED TERMS
  1. Tri-Star

    A type of candlestick pattern that signals a reversal in the ...
  2. Silent Second Mortgage

    A secondary mortgage placed on an asset that is not disclosed ...
  3. Postnuptial Agreement

    A contract created by spouses after entering into marriage that ...
  4. Confidentiality Agreement

    A legal agreement between two or more parties that is used to ...
  5. Gentleman's Agreement

    An unwritten agreement or transaction backed only by the integrity ...
  6. Option Agreement

    1. A signed agreement between an investor who is seeking to open ...
Related Articles
  1. Easy Ways To Cut Rental Costs
    Options & Futures

    Easy Ways To Cut Rental Costs

  2. What is an alienation clause?
    Investing

    What is an alienation clause?

  3. ISDA Master Agreement
    Investing Basics

    ISDA Master Agreement

  4. 4 Contract Essentials You Need to Know
    Budgeting

    4 Contract Essentials You Need to Know

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center