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Glossary → Cross-collateralisation

Cross-collateralisation

Cross-collateralisation is when one loan (or lender) is secured against more than one of your properties — the bank holds them as a bundle.

It's convenient early on but reduces your flexibility: selling one property may require the bank's consent and a revaluation of the rest, and the lender effectively controls your whole portfolio. Many experienced NZ investors deliberately split lending across banks ("stand-alone" securities) as their portfolio grows. This is a structure conversation worth having with a mortgage adviser before property number two, not number five.

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