Blanket Loan
Also known as a blanket mortgage, this type of loan covers
more than one parcel of property. Usually, individual parcels
are released or partially released from the blanket
loan / mortgage
as the debt is paid off.
Example:
Might use a blanket mortgage to pay for construction of several homes in one
neighborhood. When a home is sold, the portion of the mortgage that was used to
fund that home is paid back to the lender, and then retired. The remaining
outstanding balance is adjusted accordingly, and the blanket mortgage continues
phase by phase in that manner, until all houses are sold and the entire mortgage
is repaid and retired.
