Blended rates for 2 combined mortgages?

Question

I currently have a rental property that has >$100,000, maybe $130,000 of equity. Would a bank(say like BankofAmer) allow me to assume the low interest rate of another property and blend the interest rate with my current rental property? Based on my equity, creditworthiness, and history with them? I already do business with BankofAmer. But if not BankofAmer, would another mortgage lender take on the 2 mortgages and blend the interest rates together based on my credit and possibly even cash flow? Thx.

Devin Peterson · Answer

Ismael, More than likely it is not the case any bank will copy and paste the current terms of another asset onto a new one. Thy would be losing money in that situation. Pricing and rates change constantly so if you are seeking cash out of a rental property you can entertain a second DSCR equity loan up to 70CLTV to keep your first in place or take a look at a full new cash-out option. Hope that helps, good luck!

Erik Estrada · Answer

I am a little confused on the question. Are you looking to combine both your first mortgage on a rental property you own with a purchase of a new rental property where you are assuming the note?

There is no such thing as blending the interest rates together unless you are getting a second mortgage out from your current rental and are looking at the overall blended rate with the first and second loan on the rental property you currently own.

What you could do is use the equity from your current rental via a cash out or second mortgage and use those funds as the downpayment for the property that has an assumable mortgage.