LOAN COVENANT Definition

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LOAN COVENANT is a legally enforceable promise or restriction in a mortgage. For example, the borrower may covenant to keep the property in good repair and adequately insured against fire and other casualties. A breach of covenant in a mortgage usually creates a default, defined by the mortgage, and can be the basis for foreclosure.

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TARGET COSTING is a disciplined process for determining and realizing a total cost at which a proposed product with specified functionality must be produced to generate the desired profitability at its anticipated selling price in the future.

PURCHASE AND INSTALLMENT SALEBACK, in real estate, is a contract purchase of real property upon the completion of construction. The subject property is then immediately sold back on a long-term installment contract.

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