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LSDefine
Simple English definitions for legal terms
blanket mortgage
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A quick definition of blanket mortgage:
A blanket mortgage is a type of loan that covers multiple properties. It is used as security for a debt or obligation, and the lender can take possession of the properties if the borrower fails to repay the loan. This type of mortgage is different from a traditional mortgage, which only covers one property. Blanket mortgages are often used by real estate investors who own multiple properties and want to consolidate their debt into one loan.A more thorough explanation:
A blanket mortgage is a type of mortgage that covers two or more properties that are pledged to support a debt. It is a single mortgage that covers multiple properties. This type of mortgage is often used by real estate investors who own multiple properties and want to use them as collateral for a loan.
For example, let's say an investor owns three rental properties and wants to take out a loan to purchase a fourth property. Instead of taking out a separate mortgage for each property, the investor can take out a blanket mortgage that covers all four properties. If the investor defaults on the loan, the lender can foreclose on all four properties.