Which of the following best describes a blanket mortgage?

• A. A mortgage covering a single property
• B. A mortgage covering multiple parcels of real estate
• C. A short-term loan based on future interest rates
• D. A mortgage with a fixed repayment schedule

Answer: (B)

A blanket mortgage is best described as a mortgage that encompasses multiple parcels of real estate. This type of mortgage allows a borrower to secure financing for several properties under one loan agreement, which can simplify the borrowing process. It is often used by developers or investors who may own multiple properties or those looking to finance large projects, as it reduces the number of loans and can lead to cost savings on closing costs and administrative fees.

The concept of a blanket mortgage also allows for the possibility of selling off individual parcels of property without needing to refinance the entire loan, as long as certain conditions in the mortgage agreement allow for partial releases. This flexibility is a primary feature that distinguishes blanket mortgages from other types of loans, which generally focus on single properties or simpler financing structures.