Portfolio loans good?bad?ugly?

Question

Looking for some advice as I scale.

i own 7 properties now, rentals, mostly duplexes. I'm thinking of applying for a portfolio loan that allows 90% LTV...: to my knowledge it will group three (or more) of my properties into one new loan. Allowing me to pull cash out to scale.

what are some downsides to portfolio loans? Any experience on these? Good or bad news?

Welcome any advice you can offer.

Quinton Brown · Answer

are you looking for a cashout? we have portfolio and blanket.. however 90% is tough

Doug Smith · Answer

Just a note on terminology. A "Portfolio Loan" is a loan that a lender holds onto in their portfolio rather than selling it off. I think you mean a loan that uses multiple properties as collateral, which is referred to as a "Blanket Loan". Am I correct in assuming that is what you are asking about...a Blanket? As a lender, I am normally not a fan of a blanket because it limits your ability to sell individual properties that are collateralized in the blanket. Many do have "partial release clauses" which allow you to release individual properties if the loan amount is paid down by a certain amount. This amount of paydown, however, is often more than that property's portion of the total loan amount. Most that I see require a 1.25X paydown of that portion to do a partial release. It works well if you have a huge amount of properties that you wish to hold and eventually sell as a group as it might keep some of the closing costs down, but that partial release issue usually has me avoiding blankets. I do hope I interpreted your intentions correctly and I hope that helped.