Pros/Cons of Portfolio vs Individual Loans in Commercial Lending?

[Daniel Dietz]

Hello,

We are getting close to finalizing a loan(s) for a set of 3 duplexes we are buying within our LLC. The properties are all similar in value and have a total value of about 500K. We are able to get terms of 20% down, 4.5%, 25 year amortization and a 10 year lock. Only max of 1% rate hike per year after that.

Our lender is offering us the option of doing one "blanket loan" that would encompass all the properties, or doing an individual loan on each one. The loan 'fees' are under 1K per loan. Appraisal, title search, etc.. would be needed either way.

What do you more experienced investors or financial types see as pros and cons to each way?

I see the benefit of a blanket loan in that once the properties appreciate or are paid down enough that is would be easier to roll that equity as one 'bunch' into a new property. I see the con as extra paperwork needed if we want to sell one property off. 

I see the benefit of individual loans as it is easier sell of a property if desired. 

What are all of your thoughts?

Thanks, Dan Dietz