When a lender receives a specified portion of a property's net operating income and/or net sale proceeds as part of the loan agreement, this loan type is more commonly referred to as a:

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A participation loan is a type of loan where the lender shares in the profits and losses of the project with the borrower. This often involves receiving a specified portion of the property's net operating income or net sale proceeds, making it the best answer for the given question. A mini-perm loan is a type of loan that combines features of a short-term construction loan and a long-term mortgage, typically used for commercial properties. A mezzanine loan is a type of financing that combines debt and equity, and typically involves a subordinate lien on the property. A bullet loan is a type of loan that requires the borrower to make one large payment at the end of the loan term, rather than making periodic payments.

When a Lender Receives a Specified Portion of a Property's