A cross-collateralized mortgage is one that uses multiple (at least two) properties as collateral for the loan. The mortgage is “cross-collateralized” against multiple properties to provide additional security for the lender. Most mainstream banks do not accept cross collateralization in residential lending. At SMB, we do.
- In purchase transaction, cross collateralization can increase borrower’s purchasing power, enable to buy a big property or obtain higher LTV
- In refinancing transaction, cross collateralization allows borrower to leverage their equity in
non-subject properties and maximize the loan amount or cash out.
–Primary, second home or investment properties
–Non-QM portfolio products
–Vesting in individual, trust, LLC, corporation or partnership