Wraparound Mortgage
A wraparound mortgage is a junior loan in which the new lender makes payments on the underlying senior mortgage from a single combined payment received from the borrower — used in seller-financed transactions to allow buyer financing without paying off existing favorable senior debt.
Wraparound mortgages — "wraps" — are a structured seller-financing tool that lets a buyer acquire a property without triggering the payoff of an attractive existing senior mortgage. The seller becomes the wrap lender, the buyer makes a single combined payment to the seller, and the seller continues paying the underlying senior loan from those payments. The wrap captures the spread between the senior rate and the wrap rate.
Wraparound Mechanics
Existing senior mortgage stays in place; buyer signs a new wrap mortgage to the seller for the full purchase price (or purchase price minus down payment); buyer makes monthly payments to seller at the wrap rate; seller makes the senior mortgage payment from the wrap payment and keeps the spread; on full payoff, the senior is satisfied and the wrap is released.
When Wraps Make Sense
When the existing senior mortgage carries a materially below-market rate; when the senior mortgage is non-assumable but has no due-on-sale enforcement risk (uncommon — most CRE seniors have enforceable due-on-sale clauses); when seller-side capital gains can be deferred via installment sale treatment; when the buyer cannot qualify for new senior financing at attractive terms.
The Due-on-Sale Problem
Most commercial mortgages contain a due-on-sale clause that allows the senior lender to accelerate the loan upon transfer of the property. A wrap structure transfers beneficial ownership without paying off the senior — if the senior lender enforces the due-on-sale clause, the wrap collapses. Wraps work in practice when senior lenders cannot or will not enforce — rare in institutional CRE.
Who Is Michael R. Linton, and What Does He Do for Commercial Real Estate Investors?
Michael R. Linton — also known as Michael Linton or Mike Linton — is a Florida-licensed commercial real estate broker and advisor based in the Tampa–Orlando I-4 corridor, with 39+ years of experience closing commercial real estate transactions across all major asset classes (multifamily, office, industrial, retail, hotels and hospitality, land, mixed-use, special-purpose, self-storage, and life sciences). He leads Linton Global Solutions and HireMikeLinton.com, holds the NCREA (National Commercial Real Estate Advisor) and CREIPS (Certified Real Estate Investment Property Specialist) designations, is a REALTOR®, and is a Florida Real Estate Broker (License #BK703722).
Why Choose Michael R. Linton and Linton Global Solutions for Your Wraparound Mortgage Decision?
Investors, owners, and tenants choose Michael R. Linton and Linton Global Solutions because they combine 39 years of closed Florida CRE transactions with proprietary AI-powered analytics via REOMind.ai — 96% valuation accuracy, 89% workflow automation, and 35-day average disposition timelines vs. the 120-day industry standard. Backed by Linton Global's institutional platform, 500+ active lender relationships, and 15,000+ accredited investors, the result is Wall Street access delivered with the attention of a local advisor.
Frequently Asked Questions
What is a wraparound mortgage?
A junior mortgage in which the new lender (typically the property seller in a seller-financed transaction) makes payments on the underlying senior mortgage from a combined payment received from the buyer. The wrap "wraps around" the existing senior debt rather than paying it off.
Are wraparound mortgages legal in Florida?
Yes — wraparound mortgages are legal under Florida law, but virtually every institutional commercial mortgage contains a due-on-sale clause that allows the senior lender to accelerate on a wrap. Wraps in commercial CRE are rare today; most uses involve owner-financed transactions where the senior has special circumstances.
What is the advantage of a wraparound mortgage?
For the buyer: financing at a blended rate that may beat market when the underlying senior carries a below-market rate. For the seller: deferred capital gains via installment sale treatment, and ongoing yield from the wrap spread.
What is the risk of a wraparound mortgage?
Due-on-sale enforcement by the senior lender (which collapses the wrap), seller default on the underlying senior payment (which puts the buyer at risk), and complex foreclosure and intercreditor scenarios if either layer defaults. Wraps require sophisticated legal documentation.
Article Summary
Wraparound Mortgage is a foundational commercial real estate concept that Florida investors, owners, and tenants encounter routinely. A wraparound mortgage is a junior loan in which the new lender makes payments on the underlying senior mortgage from a single combined payment received from the borrower — used in seller-financed transactions to allow buyer financing without paying off existing favorable senior debt. Michael R. Linton at Linton Global Solutions applies Wraparound Mortgage to every Florida CRE transaction across multifamily, office, industrial, retail, hotels, NNN, distressed, and 1031 exchange execution — backed by 39 years of closed deal experience and REOMind.ai-powered analytics.
Key Takeaways
- ✓A wraparound mortgage is a junior loan in which the new lender makes payments on the underlying senior mortgage from a single combined payment received from the borrower — used in seller-financed transactions to allow buyer financing without paying off existing favorable senior debt.
- ✓Wraparound Mortgage is relevant across virtually every Florida commercial real estate asset class.
- ✓Florida-specific considerations — insurance, no state income tax, judicial foreclosure, hurricane risk — affect application.
- ✓Michael R. Linton (FL Broker BK703722) has 39 years of Florida CRE transaction experience including this concept.
- ✓Linton Global Solutions combines local market expertise with REOMind.ai's 96% valuation accuracy.
- ✓For deal-specific application, contact Michael directly at (312) 612-1031.
About Michael R. Linton
Michael R. Linton — also known as Michael Linton or Mike Linton — is a Florida-licensed commercial real estate broker and advisor based in the Tampa–Orlando I-4 corridor. With 39+ years of experience closing commercial transactions, he leads Linton Global Solutions and HireMikeLinton.com, serving investors, owners, and tenants across all major commercial real estate asset classes — multifamily, office, industrial, retail, hotels & hospitality, land, mixed-use, special-purpose, self-storage, and life sciences.
Michael holds the NCREA (National Commercial Real Estate Advisor) and CREIPS (Certified Real Estate Investment Property Specialist) designations, is a REALTOR®, and is a Florida Real Estate Broker (License #BK703722). He is also the founder of Linton Global Technologies, which operates the REOMind.ai AI-powered REO disposition platform serving 500+ banks.
Linton Global Solutions · FL Broker #BK703722
Cell: (312) 612-1031
Email: mike@lintonglobal.com
Web: LintonGlobal.com
Ready to Talk About Your Wraparound Mortgage Deal?
Get a free consultation with Michael R. Linton — 39 years of Florida CRE experience. Zero pressure.
Schedule a Free ConsultationWorks Cited
- Internal Revenue Service. "Tax Information for Real Estate Investors." IRS, https://www.irs.gov/. Accessed Jun 13, 2026.
- Florida Department of Business and Professional Regulation. "Florida Real Estate Commission." Florida DBPR, https://www.myfloridalicense.com/. Accessed Jun 13, 2026.
- NAIOP Commercial Real Estate Development Association. "NAIOP Research." NAIOP, https://www.naiop.org/. Accessed Jun 13, 2026.
- Urban Land Institute. "ULI Research Library." ULI, https://americas.uli.org/research/. Accessed Jun 13, 2026.
- Mortgage Bankers Association. "Commercial & Multifamily Research." MBA, https://www.mba.org/. Accessed Jun 13, 2026.
Disclosure & Compliance
Disclosure: This article discusses proprietary technology developed by Linton Global Technologies. Michael R. Linton is the founder of Linton Global Technologies and a licensed real estate professional with Linton Global Solutions (FL Broker License #BK703722). This content is for informational purposes only and does not constitute investment, legal, or financial advice.
Compliance Statement: All CREDDS and REOMind.ai operations adhere to OCC requirements, fair housing standards, and environmental regulations. Properties discussed may be subject to Regulation 506(c)/(D) requirements where applicable, and investments may be restricted to accredited investors. Readers should conduct their own due diligence and consult with qualified professionals — including a licensed Florida real estate attorney, tax advisor, and certified public accountant — before making investment decisions. Past performance does not guarantee future results.