Construction Loan Note - CLN
A short-term obligation in the form of a note, used for the funding of construction projects such as housing developments. In most cases, the note issuers will repay the note obligation by issuing a longer term bond and using the proceeds from the bond to pay back the note.
Investopedia Commentary
This type of financing is most often seen at the municipal level: for example, a large city might use a construction loan note to finance a large housing project to meet the demands of its growing population.
Related Links
Bond Basics Tutorial
Promissory Notes Can Be Less Than Promised
See also: Bond, Bond Anticipation Note - BAN, Municipal Bond, Note, Obligation, Revenue Anticipation Note - RAN, Short Term, Tax Anticipation Note - TAN
Also spelled: CLN