holdback - (1) a portion of a construction loan retained by the lender until the lender is satisfied that all contracted work is complete, or that a certain percentage of a commercial property is leased; (2) in a construction or home improvement setting, the portion of the contractor's compensation that is withheld until proof is provided that all subcontractors have been paid and all mechanic's liens have been released. See also mechanic's lien . (3) in an escrow, a portion of the seller's proceeds that is retained by escrow to secure performance of some task after the close of escrow. A typical example is money held to perform pest control work on the property after the close of escrow. Escrow companies will generally hold 1½ times the estimated cost of the work.

© 2004 Bella Vista Publishing Company, Inc.  ISBN 0-9718225-0-6

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