They burden other properties: Should there ever be a problem with paying the mortgage, all involved properties are at risk.
Separation is complicated: Should the borrower decide to sell one of the subject properties, the separation can be a problem. Unless the equity is sufficient in the remaining property(ies), it could require refinancing to free up the other property.
Locked up assets: Related to the separation item above, all the properties in a blanket real estate mortgage are locked up in the transaction. Should the borrower have a need to deal separately with one of the properties at a later date, it can be difficult.
For borrowers wishing to use a blanket real estate mortgage, it is important to weigh the pros and cons. There are definitely situations in which this type of mortgage can be very attractive.
