Wrap Mortgages

I was talking with a local attorney yesterday who is into commercial real estate investing. He told me that he has all of his properties under the same financing and called it a Wrap Mortgage. He advised that anytime we buy a new property, that we should if at all possible try to wrap it into our other property’s financing. I didn’t understand that statement 100%, so I thought I would ask you all! :slight_smile:
Let me know the scoop…Do any of you do this with your properties?

Can be a real pain in the A** if you ever decide to sell one of the properties in the wrap/blanket.

Ah I see. So, how exactly does a Wrap Mortgage work?

also if you default on one of the propeties, you lose them all. I don’t understand his thinking lol.

So are there any advantages to having them all in one mortgage?

Ah I see. So, how exactly does a Wrap Mortgage work?

A wrap mortgage will include 2 or more properties as it’s assets. I have refinanced several of these and as was previously mentioned they are a pain in the arse. You have to get the lender to agree to splinter the particular mortgage away from the others and calculate an individual payoff. Then the lender has to regroup the remaining parcels back into the existing loan.

Howdy Jaydee:

A more common wrap is when the seller is financing a property and leaves his mortgage or mortgages in place and wraps them. The seller is collecting on the entire note from the buyer and then paying the underlying mortgage(s). The seller will usually have equity in the property and will collect a down payment.

The loans where you put several properties into one are called blanket loans. I have never heard a blanket loan called a wrap but it is possible in different parts of the country.

I was thinking the same thing, Ted, but was busy when I read this before…!


ya know we speak funny in the north. We don’t have soda’s, we are never fixin’ to do anything. ;D


Sorry to burst your bubble, but where I’m from, Ohio is on the fringe of the “Deep South”!


It’s been a real treat here in Louisiana trying to learn a new language…some of my favorites:

“Might could”
“Fixin’ to…” or in some part “Fitsin’ to…”
“Useta could”
“Rent house”