Portfolio loan- how to?

Question

What are ways to get properties not adjoined to each other, maybe even many miles apart, under a portfolio loan? Versus getting a loan for each?
Or is it when folks sell a portfolio, they might’ve had a loan for each property?

Thanks!

Drew Sygit · Answer

usually called blanket loans:)

Ramsey Slim · Answer

I’ve been approaching this from the lender side rather than the product side, trying to find institutions that support I acquisition at auction, rather than forcing everything into a standard box.I am exploring portfolio LOCs and cross-collateralized facilities that allow fast deployment with the option to term out later. One nuance I didn’t expect: several “flexible” LOCs are ACH-only outbound. Even at 0% interest, that’s a non-starter for auction purchases that require same-day or next-day wires.

For context: I have 4 stabilized rentals in MI with portfolio DSCR ~1.5+ and strong cash flow. Pre-LOC, I’m around ~30% LTV, so the issue isn’t equity—it’s access and flexibility.

I mainly buy auction and off-market properties across multiple states, so I’m trying to avoid term debt where interest runs long before capital is deployed. A primary-residence HELOC would be ideal, but I recently moved and don’t have enough equity or seasoning yet. I’ve even considered temporarily moving back to a high equity rental (I work remote), though I’m not convinced that's the right thing to do.

Curious what’s worked for others at a similar stage:
• Which lender types have been most flexible in practice?
• Any structures you didn’t initially consider but ended up working well?
• Any lenders in Michigan (Portfolio) or Georgia (Current Home)?

Roland Cordar · Answer

Thanks for that Dave! Closing on 1/23 and then the 30-45 day ID clock commences.Hoping my timing of all this works out with rates going down.

From the commercial side too I hope.

Dave Foster · Answer

@Roland Cordar, You can also consider that "one" purchase of a portfolio of multiple properties in the 1031 exchange.  Which, should bolster your attempt to get it treated as a portfolio loan.

When selling to one buyer with one contract and settlement statement, it is easy to classify it as one sale for a 1031 exchange.  The same is true with a purchase of multiple properties on one settlement statement with one contract.  That can be treated as one purchase even though it is multiple properties.

This can also be done as part of your identification process.  You can name multiple properties as a "portfolio" and have it counted as one identification.  The only trick is that, once identified as a portfolio, you must either purchase all of the portfolio or none of the portfolio.  You can't cherry pick one or two properties off the portfolio.  Your identification is the portfolio.

Roland Cordar · Answer

Thanks so much Caleb! Great write up. Yeah I’m about to close and want to do a 1031 and not get told again “we can’t bundle these” even when they were within 20 ft of each other from same seller. Didn't like having to do two loans. Looking to split profits into two separate multifamily unless I can find one good property that meets my min purchase price requirement.

Caleb Triumph · Answer

Great question — from a lender’s perspective (@Skytree Investments), both structures exist, and which one makes sense depends on how and when the properties were acquired.

In reality, most portfolios start out with individual loans, especially when properties are bought over time and in different markets. It’s very common for investors to later refinance multiple properties into a single portfolio loan once cash flow is stabilized and the portfolio has a track record.

A true portfolio loan can absolutely include properties that aren’t adjacent — even across different states — but lenders usually look for:

• Strong, stabilized cash flow across the entire portfolio
• Cross-collateralization (the properties secure each other)
• Consistent DSCR and operating history
• Fewer, higher-quality assets versus a large scattered pool

Strong, stabilized cash flow across the entire portfolio

Cross-collateralization (the properties secure each other)

Consistent DSCR and operating history

Fewer, higher-quality assets versus a large scattered pool

Some banks and private portfolio lenders will do this, but it’s more relationship-driven and less cookie-cutter than one-loan-per-property.

The tradeoff I usually explain to investors:

• Portfolio loan: one payment, flexibility, cleaner balance sheet — but cross-default risk
• Individual loans: more admin, but easier to sell or refinance properties one at a time

Portfolio loan: one payment, flexibility, cleaner balance sheet — but cross-default risk

Individual loans: more admin, but easier to sell or refinance properties one at a time

Most experienced investors I work with use individual loans early on and consolidate later when scale and stability justify it.

Happy to answer questions from the lending side if helpful.