Commercial mortgages held in the portfolios of lenders are generally referred to as
unsecuritized commercial mortgages
portfolio loans or portfolio mortgages. These types of loans are held by the lender for the entire loan term, rather than being sold on the secondary market like many other types of loans.
Commercial mortgages are loans used to purchase or refinance commercial properties such as office buildings, retail spaces, and apartment complexes. When a lender approves a commercial mortgage, they may choose to keep the loan on their books rather than selling it to a third party. This allows the lender to earn interest income and retain control of the loan, rather than simply receiving a one-time fee for arranging the loan and then passing it on to someone else.
The benefits of portfolio loans include more flexibility in the underwriting process, the ability to customize loan terms to meet the needs of the borrower, and the potential for increased profitability for the lender. However, holding loans on a lender’s books also carries some risks and requires careful monitoring to ensure that the loans remain well-performing.
More Answers:
Maximizing Investment Opportunities: Understanding the Breakdown of Real Estate Wealth in the U.S.Exploring the Significance of Real Estate in the United States as a Portion of Global Wealth
Understanding Asset Classes: Stocks, Bonds, and Cash Explained