Juggling multiple mortgages at different conditions and interest rates can be a hassle if you’re a commercial real estate investor who does it daily; blanket loans are a smarter choice to help you stay on top of the game.
You can buy as many properties as you want under a bank loan, and it’ll not be considered due on your sale agreement.
If you’re considering getting a blanket loan, this blog will increase your knowledge on why blanket loans are an ideal option for you.
As blanket loans require only one credit approval for multiple mortgages, it requires less paperwork and reduces the hassle of keeping track of it.
You don’t need to spend a lot of time collecting and submitting documents like your credit reports, asset verification documentation, and employment details.
Access to More Cash
Pooling your properties under a single loan will help expand your business. It’ll help you maximize the amount you receive in cash from the lender.
Increase Your Cash Flow
Refinancing and coming to just one blanket mortgage rather than multiple loans can help you save on monthly payments as well.
This will help increase your cash flow as you save more. However, these savings are dependent on the new interest rates available to you and the ones you’re currently paying.
It Becomes Easier To Expand Your Portfolio
The biggest challenge that numerous real estate investors face is the restrictions on the number of mortgages they can have at a particular time. This caps your expansion and hinders your proceedings.
A blanket loan, on the other hand, has no such barriers that cap your expansion. You can invest in unlimited properties under a blanket loan without showing it as due on your sale clause.
Work With Potentially Better Loan Terms
Imagine if you have ten traditional mortgages with an average loan amount of $100,000. For every lender, you’re a contributor with a $100,000 loan. You’ll hardly stand out from the crowd in their lending business of millions of dollars.
However, if you combine these loans under a blanket approval and lend it from a single place, you’ll be someone with a loan of $1,000,000.
The amount for you remains the same, but you become a significant contributor to the lender’s business. Thus you may receive V.I.P. treatment.
You can use this high-roller status for your benefit to negotiate a deal with them or even leverage a preferential loan term.
If you’re looking for options to finance your real estate business, get in touch with Commercial Private Equity. Apart from loans, we also provide commercial hard money loan consultation to guide you on the best practices for borrowing and repaying loans. We’re one of the leading private money lenders in Atlanta, GA.
Contact us to get your hard money loans sorted.