Feeling stuck trying to grow your multifamily real estate portfolio? Even with rising property values, many investors find themselves short on loan requirements —and unable to qualify for a new loan. That’s where portfolio loans offer a solution. By grouping multiple properties into a single cash-out refinance, a portfolio loan can free up capital for down payments on new investments. In this article, we’ll explain what portfolio loans are, how they work, and how they can help you scale your real estate holdings faster.
What is a Portfolio Loan?
Rather than refinance a single property, portfolio loans allow you to group several properties you own into a cash-out refinance. A new, comprehensive multiproperty loan replaces your current CRE loan and provides the difference in cash. Then, you can use the cash as a down payment on new property to grow your portfolio. You can use the funds for new property downpayments, to fund renovations, or cover operational expenses. Portfolio loans are ideal for investors who have equity, but lack liquidity. By tapping into the combined value of your properties, you gain flexibility to act quickly on new opportunities—without waiting to build cash reserves. This makes portfolio loans especially useful in competitive markets where timing is everything.
How Portfolio Loans Help Investors Scale
The flexibility of portfolio loans allows for faster, more strategic expansion of a real estate portfolio—especially when traditional financing options fall short. They can also streamline financial management by consolidating multiple commercial real estate (CRE) loans into a single loan, reducing administrative complexity. Best of all, portfolio loans provide access to liquid capital without requiring you to sell off any of your holdings.
For example, imagine you own two multifamily properties with a combined equity of $700,000. You still owe $500,000 in existing loans. A lender approves you for a portfolio loan that replaces your current mortgages with a new $900,000 loan. At closing, you receive $200,000 in cash (minus fees). You can use that capital to make a down payment on a third property, boosting your unit count and creating new opportunities for rental income and long-term growth.
When to Consider a Portfolio Loan
While traditional loans tend to disqualify borrowers based on low credit or inconsistent income, portfolio loans offer a more holistic approval process, focusing on asset performance and equity instead. This makes them a solid option for investors who may not check all the boxes for a bank loan, but who own valuable, income-producing properties. Portfolio loans provide funds based on what your property is worth. While credit scores do play a part in the lender’s decision-making process, it’s not their primary focus. You may also choose to go with a portfolio loan when traditional loans are just too slow, since they provide faster access to cash than an individual loan. This strategy is ideal in competitive markets where a delay can cost you the deal.
When you want to expand beyond traditional loan limits, a portfolio loan allows you to group multiple properties under a single, larger loan. Because these loans are typically kept on the lender’s books (rather than sold to the secondary market), underwriting guidelines are more flexible and based on the combined performance and value of the entire portfolio. This means if your properties are generating strong rental income and have appreciated in value, you may qualify for a higher loan amount—regardless of how many mortgages you already hold.
How to Apply and Qualify for a Portfolio Loan
Finding the right portfolio loan takes connecting with the right lender, one who understands your local market and has experience in the industry. Not all lenders advertise their best deals, relying instead on qualified brokers to match them with eligible borrowers. Brokers save both parties–the lender and the borrower–the time and effort it would take to screen incomplete or incompatible applications. Working with a broker is the most efficient way to streamline the application process and get approved faster.
Here are a few tips to keep in mind when preparing an application:
- Lenders need a full picture of your holdings. Gather a list of your properties, current loan balances, recent appraisals, rent rolls, and lease agreements. Your broker can guide you with a checklist of your specific lender’s requirements.
- The lender will evaluate how much equity you have across the portfolio. A broker serves as a financial translator between your portfolio’s raw numbers and the lender’s approval process—helping you unlock equity strategically and with confidence.
- Gather your personal and business financials. Make sure to include credit reports, tax returns, bank statements, and business entity documents. Not sure what’s relevant to include? Ask your broker for advice.
Lenders can delay or deny a loan simply because the loan application package is incomplete. Don’t let this happen to your application! The broker will know exactly what to show the lender, even if the lender hasn’t explicitly asked for it. This is just one area where their knowledge and experience works to your advantage.
Ready to Expand Your Portfolio?
By unlocking equity across multiple properties, you can access the cash you need to scale—whether that means acquiring new units, renovating existing ones, or simply streamlining your financial strategy.
If you’re looking to increase your cash flow and unit count without selling off assets, it may be time to explore what a portfolio loan can do for you.
Reach out today to see if you qualify and take the next step toward expanding your multifamily investment portfolio.
