When a single mortgage covers multiple properties, with the group of assets serving as collateral for the loan it is called a blanket mortgage.

It is also referred to as a blanket loan, and it can be refinanced just like any other mortgage.

When real estate developers and larger investors purchase a number of properties at a time, a blanket mortgage simplifies those transactions with one single loan.

The borrower can sell one property from the group and retain the loan for the others without needing to pay them off with a blanket mortgage.

Blanket mortgages have applications in both commercial and residential transactions and it is used by companies or developers who buy and redevelop homes.

WHO SHOULD GET A BLANKET MORTGAGE?

A Blanket mortgage is not for a borrower with a primary residence and a second vacation home.

But is designed for companies that buy homes in bulk or experienced investors or landlords that own a portfolio of commercial or residential properties.

ADVANTAGE AND DISADVANTAGES OF A BLANKET MORTGAGE

These savings results in more cash flow for additional property and other projects.

But it also requires a higher down payment, close to 25% to 50%.

And if one of the properties securing the loan gets sold, the portion of the loan that was securing that property must be paid upfront.

The borrowers with excellent credit and substantial wealth and assets can make lower payments for a period of time (like only paying interest), followed by paying a larger lump sum all at once.

HOW TO FIND A BLANKET MORTGAGE LENDER

Only a bank or lender who does a lot of commercial lending will do it.

Reference Source: Bankrate

https://www.compareclosing.com/mortgagenews/all-about-blanket-mortgage/