Cross collateralize mortgage

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Cross collateralize mortgage

Marius P.
Los Angeles, CA · Member since 2008 · 20 posts · 2 votes

Hello,

What is cross collateralize mortgage loan?

Does it make sence to do it?

Any lenders does that type of loan? What they requirements?

Thanks

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Cody L.
Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes
9y
Cross collateralized loans or simply alone that place is more than one property as collateral. I had several smaller properties that were too small to bother to put debt on. Found a lender that gave me a large loan using the full group as collateral. Just make sure there are payoff provisions in case you want to sell one without having to pay off the whole entire loan balance.
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  • Tom S.
    Real Estate Investor · Burlington, VT · Member since 2010 · 2k+ posts · 1k+ votes
    9y

    @Marius P.  Hi Marius - I have one cross collateral loan.  Talk to small local banks in your area and the commercial lending department.  They used small amounts of equity from other properties plus my personal credit to put together a loan.  For me at least, slightly higher rate (5.5% fixed, 15 year term).  $40k loan.  

    Hope that helps!

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  • Marius P.
    OP
    Los Angeles, CA · Member since 2008 · 20 posts · 2 votes
    9y

    Thank you for information.

    Looks like I have to do a lot of calling.  Let you know how it goes.

    0Reply
  • Lane Kawaoka
    Rental Property Investor · Honolulu, HAWAII (HI) · Member since 2011 · 4k+ posts · 2k+ votes
    9y
    Just beware that brokers love it. More origination fees so think for yourself.
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  • Marius P.
    OP
    Los Angeles, CA · Member since 2008 · 20 posts · 2 votes
    9y

    I spoke with one lender. She told me she can't do it, because the numbers.

    My primary residence value about $720k. First loan balance $295k.

    Looking for the second house as a rental for about $550k.

    Have cash $100k to work with.

    Maybe HELOC make more sense?

    0Reply
  • Cody L.
    Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes
    9y
    Cross collateralized loans or simply alone that place is more than one property as collateral. I had several smaller properties that were too small to bother to put debt on. Found a lender that gave me a large loan using the full group as collateral. Just make sure there are payoff provisions in case you want to sell one without having to pay off the whole entire loan balance.
    1Reply
  • Marius P.
    OP
    Los Angeles, CA · Member since 2008 · 20 posts · 2 votes
    9y

    Cody,

    Can you PM me his contacts?

    Thanks

    0Reply
  • David Johnson
    Houston, TX · Member since 2016 · 12 posts · 1 vote
    5y

    @Cody L. Can you provide the name of the lender who would consider what you're referring to?

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  • Cody L.
    Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes
    5y
    Originally posted by @David Johnson:

    @Cody L. Can you provide the name of the lender who would consider what you're referring to?

     Origin Bank.  Though not sure if they'll do the same w/ someone they don't have an existing relationship with. 

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  • David Johnson
    Houston, TX · Member since 2016 · 12 posts · 1 vote
    5y

    Thank you, Cody. I totally understand about the need for the banking relationship.

    0Reply
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