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. Postnuptial Agreement

    A contract created by spouses after entering into marriage that ...
  2. Gentleman's Agreement

    An unwritten agreement or transaction backed only by the integrity ...
  3. Confidentiality Agreement

    A legal agreement between two or more parties that is used to ...
  4. Tri-Star

    A type of candlestick pattern that signals a reversal in the ...
  5. Option Agreement

    1. A signed agreement between an investor who is seeking to open ...
  6. Silent Second Mortgage

    A secondary mortgage placed on an asset that is not disclosed ...
Related Articles
  1. Economics

    What is Earnest Money?

    An earnest money deposit shows the seller that a buyer is serious about purchasing a property.
  2. Retirement

    Time To Hire A Senior Move Manager?

    Watch for these signs that you or an elderly family member may need to downsize and move somewhere easier to manange. A senior move manager can help.
  3. Retirement

    A New Solution To Help Seniors Relocate

    As Americans age – and families try to cope – the new field of senior move managers helps seniors relocate to safer homes with the least possible stress.
  4. Investing Basics

    ISDA Master Agreement

    The ISDA Master Agreement is a document outlining the terms of an over-the-counter derivatives transaction between two parties. This document serves as a standard agreement in these transactions ...
  5. Budgeting

    4 Contract Essentials You Need to Know

    Over your lifetime, you’ll be asked to sign lots of contracts – perhaps agreeing to purchase a home, a car or to join a new gym or online dating service.
  6. Home & Auto

    Home Sale Contingencies: What Buyers And Sellers Need To Know

    Home sale contingencies protect buyers who want to sell one home before purchasing another. Find out what buyers and sellers need to know about these contractual conditions.
  7. Home & Auto

    Contingency Clauses In Home Purchase Contracts

    Here, we introduce widely used contingency clauses in home purchase contracts and how they can benefit both Buyers and Sellers.
  8. Options & Futures

    Easy Ways To Cut Rental Costs

    If rent payments are crippling your finances, then read on to learn how to save your money.

You May Also Like

Hot Definitions
  1. Asset Class

    A group of securities that exhibit similar characteristics, behave similarly in the marketplace, and are subject to the same ...
  2. Fiat Money

    Currency that a government has declared to be legal tender, but is not backed by a physical commodity. The value of fiat ...
  3. Interest Rate Risk

    The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between ...
  4. Income Effect

    In the context of economic theory, the income effect is the change in an individual's or economy's income and how that change ...
  5. Price-To-Sales Ratio - PSR

    A valuation ratio that compares a company’s stock price to its revenues. The price-to-sales ratio is an indicator of the ...
  6. Hurdle Rate

    The minimum rate of return on a project or investment required by a manager or investor. In order to compensate for risk, ...
Trading Center