Portfolio Loan versus sold loan - Benefits and Disadvantages

[Brittany Haines]

Newbie here working on my first deal!  We met with a local bank today and they are offering terms that we weren't planning for.  One of the things that came up was that they keep their mortgages in house and do not sell them.  He said other lenders sell their mortgages and that's why they are able to offer lower interest rates, whereas his rate may be higher but there is more security that comes along with it.  Can anyone speak to the benefits and disadvantages to an 'in-house' loan or portfolio loan versus those that are sold on the secondary market.  We are going to speak with another lender and if they do sell their mortgages, I guess I would want to know if that's a big deal or not or people's experiences with this.  Thanks!