Take-Out Lender

Financial institution that extends a long-term Mortgage on real property that replaces the interim financing, or construction loan arranged by a savings and loan, bank, or mortgage banker. The institution extending the long-term loan, or permanent financing, is often an insurance company or institutional investor willing to make a long-term investment in income producing property, realizing a capital gain from the eventual sale of the property, in addition to cash flow from rental payments by property tenants.