Blanket Mortgage: How It Works And Who Should Use It Bankrate Caret RightMain Menu Mortgage Mortgages Financing a home purchase Refinancing your existing loan Finding the right lender Additional Resources Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Bank Banking Compare Accounts Use calculators Get advice Bank reviews Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Credit Card Credit cards Compare by category Compare by credit needed Compare by issuer Get advice Looking for the perfect credit card? Narrow your search with CardMatch Caret RightMain Menu Loan Loans Personal Loans Student Loans Auto Loans Loan calculators Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Invest Investing Best of Brokerages and robo-advisors Learn the basics Additional resources Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Home Equity Home equity Get the best rates Lender reviews Use calculators Knowledge base Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Loan Home Improvement Real estate Selling a home Buying a home Finding the right agent Additional resources Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Insurance Insurance Car insurance Homeowners insurance Other insurance Company reviews Elevate your Bankrate experience Get insider access to our best financial tools and content Caret RightMain Menu Retirement Retirement Retirement plans & accounts Learn the basics Retirement calculators Additional resources Elevate your Bankrate experience Get insider access to our best financial tools and content Advertiser Disclosure
Advertiser Disclosure
We are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct research and compare information for free - so that you can make financial decisions with confidence.
Bankrate has partnerships with issuers including, but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make Money
The offers that appear on this site are from companies that compensate us. This compensation may impact how and where products appear on this site, including, for example, the order in which they may appear within the listing categories. But this compensation does not influence the information we publish, or the reviews that you see on this site. We do not include the universe of companies or financial offers that may be available to you. SHARE: jessica.kirsh/Shutterstock June 16, 2021 Checkmark Bankrate logo How is this page expert verified? At Bankrate, we take the accuracy of our content seriously. "Expert verified" means that our Financial Review Board thoroughly evaluated the article for accuracy and clarity. The Review Board comprises a panel of financial experts whose objective is to ensure that our content is always objective and balanced. Their reviews hold us accountable for publishing high-quality and trustworthy content. Ellen Chang is a former contributor for Bankrate. Chang focused her articles on mortgages, home buying and real estate. Her byline has appeared in national business publications, including CBS News, Yahoo Finance and MSN Money. Suzanne De Vita is the mortgage editor for Bankrate, focusing on mortgage and real estate topics for homebuyers, homeowners, investors and renters. John Stearns, CMC, CRMS is a Senior Mortgage Loan Originator with American Fidelity Mortgage. Bankrate logo The Bankrate promise
At Bankrate we strive to help you make smarter financial decisions. While we adhere to strict editorial integrity, this post may contain references to products from our partners. Here's an explanation for how we make money. Bankrate logo The Bankrate promise
Founded in 1976, Bankrate has a long track record of helping people make smart financial choices. We’ve maintained this reputation for over four decades by demystifying the financial decision-making process and giving people confidence in which actions to take next. Bankrate follows a strict , so you can trust that we’re putting your interests first. All of our content is authored by and edited by , who ensure everything we publish is objective, accurate and trustworthy. Our mortgage reporters and editors focus on the points consumers care about most — the latest rates, the best lenders, navigating the homebuying process, refinancing your mortgage and more — so you can feel confident when you make decisions as a homebuyer and a homeowner. Bankrate logo Editorial integrity
Bankrate follows a strict , so you can trust that we’re putting your interests first. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. Key Principles
We value your trust. Our mission is to provide readers with accurate and unbiased information, and we have editorial standards in place to ensure that happens. Our editors and reporters thoroughly fact-check editorial content to ensure the information you’re reading is accurate. We maintain a firewall between our advertisers and our editorial team. Our editorial team does not receive direct compensation from our advertisers. Editorial Independence
Bankrate’s editorial team writes on behalf of YOU – the reader. Our goal is to give you the best advice to help you make smart personal finance decisions. We follow strict guidelines to ensure that our editorial content is not influenced by advertisers. Our editorial team receives no direct compensation from advertisers, and our content is thoroughly fact-checked to ensure accuracy. So, whether you’re reading an article or a review, you can trust that you’re getting credible and dependable information. Bankrate logo How we make money
You have money questions. Bankrate has answers. Our experts have been helping you master your money for over four decades. We continually strive to provide consumers with the expert advice and tools needed to succeed throughout life’s financial journey. Bankrate follows a strict , so you can trust that our content is honest and accurate. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. The content created by our editorial staff is objective, factual, and not influenced by our advertisers. We’re transparent about how we are able to bring quality content, competitive rates, and useful tools to you by explaining how we make money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and, services, or by you clicking on certain links posted on our site. Therefore, this compensation may impact how, where and in what order products appear within listing categories. Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range can also impact how and where products appear on this site. While we strive to provide a wide range offers, Bankrate does not include information about every financial or credit product or service. What is a blanket mortgage
A blanket mortgage is a single mortgage that covers multiple properties, with the group of assets serving as collateral for the loan. Real estate developers and larger investors often purchase more than one property at a time, so a blanket mortgage allows them to simplify those transactions with one loan. The blanket mortgage also allows the borrower to sell one property from the group and retain the loan for the others without needing to pay them off. Blanket mortgages have applications in both commercial and residential transactions, including those involving or buildings. They are also used by companies or developers who buy and . “While they are usually used in a commercial context, there are residential landlords that utilize a blanket mortgage to finance a portfolio of rental properties,” says Greg McBride, CFA, chief financial analyst for Bankrate. A blanket mortgage is also referred to as a blanket loan, and it can be refinanced just like any other mortgage. Who should get a blanket mortgage
Blanket mortgages are designed for companies that buy homes in bulk, or experienced investors or landlords that own a portfolio of properties, either commercial or residential. “This is not for a newbie, mom-and-pop landlord that is looking to jump into full-scale real estate management overnight,” McBride says. They are also not intended for a borrower with a primary residence and a second vacation home. Pros and cons of a blanket mortgage
All mortgages come with , but there can be some savings with a blanket mortgage because you’re closing just one loan as opposed to separate loans for each property, McBride says. These savings translate to more cash flow for additional property or other projects. Blanket mortgages require a higher down payment, however — north of 25 percent to as much as 50 percent — which can be a roadblock, McBride adds. If one of the properties securing the loan is sold, you must pay back the portion of the loan that was securing that property — you can’t just pocket it. The blanket mortgage might be structured with a , as well. This allows the borrower to make lower payments for a period of time, followed by paying a larger lump sum all at once. Sometimes the loan is structured so that the borrower is only paying interest initially. This type of arrangement tends to be offered to borrowers with excellent credit and considerable wealth and assets. How to find a blanket mortgage lender
Mortgage lenders who specialize in blanket mortgages aren’t as readily available as those offering other types of loans. Begin by researching commercial lenders and taking note of their rates, fees and down payment requirements. “Blanket mortgages do not have blanket availability,” McBride says. “You’ll have to do some digging to find lenders and mortgage brokers that work with borrowers on this type of loan. Oftentimes a bank or lender that does a lot of commercial lending will have this as part of their product lineup.” Learn more
SHARE: Ellen Chang is a former contributor for Bankrate. Chang focused her articles on mortgages, home buying and real estate. Her byline has appeared in national business publications, including CBS News, Yahoo Finance and MSN Money. Suzanne De Vita is the mortgage editor for Bankrate, focusing on mortgage and real estate topics for homebuyers, homeowners, investors and renters. John Stearns, CMC, CRMS is a Senior Mortgage Loan Originator with American Fidelity Mortgage. Related Articles