A portfolio loan is a loan held in house by the lender. In many cases, loans that are issued by lenders are packaged together with other loans and sold to the secondary market. With a portfolio loan, the lender that initially started the loan will hold the loan in their investment portfolio.
The benefit to a portfolio loan is that often the borrower can go a little outside of the guidelines if the lender feels there is till safe risk. Typically a portfolio loan does require a stronger credit borrower.
