Core terms
AB Contract: the first purchase contract in a double close.
BC Contract: the resale contract from the investor to the end buyer.
EMD: earnest money deposit.
Escrow: a neutral arrangement where money or documents are held until conditions are met.
POF: proof of funds.
Assignment: transfer of contractual rights to another buyer.
Double Close: two back-to-back sales where the middle party takes title.
Transactional Funding: short-duration capital used to complete a transaction, often repaid from a near-term closing event.
Capital Stack: the combination of different funding sources used in one transaction.
Lien Position: the order in which secured creditors are repaid from collateral.
Balloon Payment: a large remaining balance due at a future date.
Non-refundable Fee: a fee that is earned and not returned once specified conditions occur.
Stabilized Value: estimated value after a property reaches normal occupancy, rents, and operating performance.
Exit Strategy: the planned event that repays capital or ends the investment.
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