What is it called when an investor uses multiple parcels of land as collateral for a single loan?

When an investor uses multiple parcels of land as collateral for a single loan, the arrangement is known as a blanket mortgage. This type of mortgage is specifically designed to cover more than one piece of real estate, allowing the property owner to secure financing across multiple properties in a single loan transaction. This can be particularly beneficial for investors who wish to streamline their financing and manage the properties collectively under one mortgage agreement.

A blanket mortgage can also facilitate development projects or allow for the sale of individual parcels without having to refinance or pay off the entire loan for all properties involved. This characteristic makes it an attractive option for real estate investors who are working with several pieces of land or properties.

In contrast, other types of mortgages like fixed-rate, construction loans, or variable-rate mortgages do not involve the use of multiple parcels as collateral within the framework described. A fixed-rate mortgage typically covers a single property with a consistent interest rate, while a construction loan finances the building of a property rather than encompassing multiple parcels already owned. A variable-rate mortgage may adjust interest rates over time but also does not inherently involve multiple properties as collateral.