interim financing

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Interim financing

A short-term loan made to a company on the condition that a takeout will follow with long-term or intermediate financing.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Interim Financing

A short-term loan intended to maintain a company's operations while it makes arrangements for longer-term financing. For example, a start-up may take out a loan for a few months while it prepares its initial public offering.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

interim financing

The financing that supports a transaction until permanent financing can be arranged.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

interim financing

A short-term loan arranged in order to buy time until something changes. At the end of the original construction loan period, a developer may wish to seek interim financing rather than permanent financing because of an expectation that interest rates will fall in the future, or because the developer's plans have changed and the property will be sold rather than retained. The problem with permanent financing and many development projects is the existence of very large prepayment penalties—one cannot simply refinance when interest rates go down or simply pay off the loan when there is a sale. A borrower may also seek interim financing because the borrower's financial strength, or that of income-producing property serving as collateral, is not currently sufficient to justify attractive financing terms.

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.
References in periodicals archive ?
In case they do not want to wait six years, they can take a commercial interim loan.
Mercantile is a wholly-owned subsidiary of IBERIABANK (IBKC) and has been a primary source of SBA 504 loans and interim loans nationwide since 2003.
* Two interim loans totaling $8,750,000 were arranged by Richard Pergolis for a six story elevator commercial building in Long Island City, NY.
Wachovia Real Estate Capital Markets, led by Bill Green, provides nonrecourse permanent and interim loans through CMBS conduit and mortgage banking executions, mezzanine and B-note financing, equity co-investing, sale-leaseback and synthetic lease structures.
Founded in 2002, Mercantile has been a primary source of SBA 504 loans and interim loans nationwide.
Cambridge has consistently ranked among the country's top five FHA-insured HUD lenders (now HUD LEAN) over the last 15 years and offers an array of conventional lending options, including permanent construction and interim loans on either a floating or variable rate basis.
Small Business Administration 504 loans that assist small business owners acquiring or developing their own facilities, has announced the launch of a new website dedicated exclusively to SBA 504 interim loans.
Additionally, Cambridge is the sole correspondent specializing in senior housing for American Property Financing, Inc., a Fannie Mae DUS lender, and offers a wide array of conventional lending options for senior housing / healthcare owners, including permanent construction and interim loans on either a floating or variable rate basis.
Permanent financing: A mortgage Loan, usually covering development costs, interim Loans, construction Loans, financing expenses, marketing, administrative, legal, and other costs.
More recently, JHP Realty Advisors have arranged several complex transactions that included forward commitments, earn-outs on existing properties, new construction and renovation projects, and interim loans suitable for repositioned properties.
An interim loan may, for example, need a substantial interest reserve because the property is not yet cash-flowing enough to cover interest expense, but is projected to do so after a stabilization period.

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