We are not talking about a cozy blanket in this post. However, sometimes getting a blanket mortgage can create a cozy deal.
A blanket mortgage streamlines the financing process by allowing borrowers to collateralize multiple properties into a single loan. This is a great tool for those who are looking to purchase or refinance multiple properties.
Banket Mortgage Qualifications
In order to qualify for a blanket mortgage, typically borrowers first need to have enough equity available in their properties. They will also be subject to credit and income requirements, which may require additional supporting documentation.
Advantages
Blanket mortgages give borrowers more flexibility and control over their finances by allowing borrowers to register different charge priorities on different properties. This means that if just one property is sold, they may use the sale proceeds to pay off the mortgage rather than affecting the other properties.
Disadvantages
Borrowers often confuse blankets with a Mortgage Bridge.
Additionally, they are usually more complex than traditional mortgages, since they involve multiple properties and possibly multiple borrowers. This is why it’s important to work with a licensed mortgage professional who can help guide you through the process and ensure that you are getting the best possible terms and conditions for your situation.
Summary of a Blanket Mortgage
- Collateralize 2 Assets. It takes more than one asset to perform a blanket. Two homes, or one home and a car, or three homes altogether. The list continues.
- Available equity. More often than not, equity must exist in the home to blanket.
- You can register one blanket mortgage at different charge priorities on different homes.
- Blankets can be confused with a Mortgage Bridge
Furthermore, ownership of separate assets would mean joint debt ownership, and as such both borrowers will need to be on title.
Carefully consider all of the risks and benefits before making a decision, and work with a trusted mortgage professional to ensure that you are making an informed choice. Give us a call today if you have any questions or are in need of a Blanket Mortgage!
