If you are a real estate investor with multiple properties under your name, you know juggling multiple mortgages can be a real hassle.
The blanket mortgage takes care of this. A single payment is made via one bank with a single set of terms that apply to the loan on a blanket loan. This way, a real estate investor can sell or hold several properties under one mortgage.
Blanket loans provide several benefits for investors.
Access to more equity
Taking your properties and bringing them together under one loan provides you access to a higher cash amount than you normally would. Fundamentally, financial institutions will not finance a loan with multiple mortgages following you.
Consolidate properties for refinancing
A blanket loan consolidates multiple loans from different lenders into one. This enables you to negotiate better terms, thereby lowering your monthly payment and increasing your properties’ value.
Saves money
A blanket loan from private blanket lenders could save you money when refinancing and closing costs. You will receive savings since you will only have one loan to refinance when switching to a new loan and a single refinancing payment.
Expand your portfolio
Many real estate investors face the challenge of expansion because they allowed only so many single mortgages at one time. When it comes to expanding and renting a greater number of properties, that barrier becomes a real problem.
A blanket loan enables you to own more properties with a fewer number of loans.
Easier payments
Making multiple mortgage payments can be a hassle. Even if they fall under the same due date, you have to keep the different loan details straight. Since it’s easy to get confused, you can miss a payment on one property or make a double payment on another unknowingly.
Customizable loans
With the blanket loan, you’ll deal with a non-traditional lender. This means you can customize the loan according to your needs.