A Blanket Mortgage covers multiple properties on the same loan

Written by Syd Johnson


Blanket mortgages are mostly used by commercial developers for one of two purposes: first, they might have a plot of land that they plan to develop into multiple lots and sell them off.

Instead of getting a mortgage on each individual lot, they get a blanket mortgage forrepparttar entire development. The second is if someone, not necessarily a commercial developer, has multiple plots already developed and wants to use all ofrepparttar 112127 properties as collateral for a new loan.

Onerepparttar 112128 lots are developed,repparttar 112129 owner will get a release to clearrepparttar 112130 title on each individual lot that is sold. A good application of this would be a commercial development or a subdivision. The blanket mortgage coversrepparttar 112131 entire thing during construction, and then a release is obtained for each parcel as it is sold off. A release clause must be built intorepparttar 112132 blanket mortgage that allowsrepparttar 112133 developer to sell off each unit ofrepparttar 112134 property as long as certain percentage ofrepparttar 112135 entire debt is paid off.

Short on Cash? Get a Mortgage with a Buy Down

Written by Syd Johnson


A buy down is an alternative financing technique where you make significantly lower payments forrepparttar first few years ofrepparttar 112126 loan, and make uprepparttar 112127 difference with larger payments inrepparttar 112128 later years ofrepparttar 112129 loan. The initial payments might be interest only or less than interest payments, so you can expect to pay a much larger monthly fee when you actually start working onrepparttar 112130 principal.

Loan structure If you get a temporary buy down,repparttar 112131 seller might providerepparttar 112132 loan with a very low interest rate and no up front fees or points. This will make your loan package extremely cheap. Your monthly payment will be significantly smaller thanrepparttar 112133 actual amount required to pay offrepparttar 112134 monthly interest and decreaserepparttar 112135 loan principal.

Then according torepparttar 112136 contractrepparttar 112137 interest rate is increase by a small percentage each year, until your payments level off and cover both monthly interest payments and a reduction inrepparttar 112138 principal.

Byrepparttar 112139 timerepparttar 112140 loan is actually paid off, you will have a very large monthly bill because all ofrepparttar 112141 fees and points that you didn’t pay up front were rolled over intorepparttar 112142 loan. You didn’t skip anything you just decided to pay it all later.

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