FINANCIAL SYSTEM AND METHOD

• US 20120239593A1
• Filed: 12/10/2010
• Published: 09/20/2012
• Est. Priority Date: 12/10/2009
• Status: Active Grant

• Current Assignee: Holzhausen Pty Limited
• Original Assignee: Holzhausen Pty Limited
• Inventors: von der Borch, John
• Granted Patent: US 8,554,657 B2
• Time in Patent Office: Days
• US Class Current: 705/36.R
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof

Abstract

The present invention relates to a data processing method and system for predicting income derived from an anticipated future benefit (Horizon Gain), wherein the system comprises: (a) registration means for registering a borrower in a first database and for registering characteristics a lender in a second database; (b) first automated means for inputting values to a first database; (c) automated means for generating databases as necessary populated with values for one or more selected future time divisions for the borrower'"'"'s asset over one or more AD'"'"'s before optimisation, the values being calculated according to a predetermined formulae; (d) visual display means to represent predicted income derived from the anticipated future benefit; (e) automated means for responding to a redemption event by determining the value of a payment to the lender that is the greater of (i) an agreed proportion of appreciation of the asset (HGAV), or (ii) qualifying outgoings (QO).

Claims

1. An automated method in a data processing system for predicting income derived from an anticipated future benefit (Horizon Gain), the method comprising the following steps:

(a) inputting to user fields in a first database, the following values;

(i) an initial value for an asset owned by a borrower, wherein the asset may increase or decrease in value over time,

(ii) a Horizon Gain Allocation percentage, expressed in favour of a lender,

(iii) the lender'"'"'s target return value,

(iv) a gearing factor, wherein the system to forecast a potential growth in asset value and therefore a Horizon Gain Allocation Value (HGAV) for any future time interval, for the gearing factor entered, and

(v) a value representing the number and size of Asset Divisions (AD),

(b) generating one or more databases populated with values for one or more selected future time divisions for the borrower'"'"'s asset over one or more AD'"'"'s before optimisation, the values being as follows and calculated according to the following formulae;

(i) an agreed periodic payment from the lender to the borrower based on an ongoing principal value (IP) calculated according to;

TB₀×

HGA_i×

R×

MRCc₀=IP 

 

equation (1),

wherein

MRCc₀ is a mandatory redemption criteria coefficient,

R is a coefficient chosen to optimize IP based on nominated lender and borrower returns at year n and borrower selected variables,

HGA_i is a horizon gain allocation proportion at time=i expressed in favour of the lender, and

TB₀ is the transaction base calculated from the asset value according to;

ADV₀−

(M)TC₀−

(P)LS₀=TB₀ 

 

equation (2),

wherein

TC₀ comprises transaction costs,

M is a coefficient chosen to weight the significance in value of TC₀,

P is a coefficient chosen to weight the significance in value of LS₀,

LS₀ comprises any lump sum payment including any premium loading made by the lender, and

ADV₀ is the asset division value calculated from the equation,

AV₀×

ADP=ADV₀ 

 

equation (3),

wherein

ADP is the asset division proportion input by a user, and

AV₀ is the whole of asset value,

and

(ii) an amount payable to a lender upon occurrence of a redemption event, calculated by selecting the greater of;

an agreed proportion of appreciation of the asset (HGAV), or

qualifying outgoings (QO),

wherein the value of QO and HGAV is first adjusted by multiplication with a coefficient calculated or selected in relation to borrower or lender criteria; and

(c) creating a visual display based on the values in the database or databases to represent predicted income derived from the anticipated future benefit.

2. An automated method according to claim 1, further comprising the step of inserting into a table a lenders qualifying outgoings (QO) value at time i calculated according to:

(M)TC_i+(P)LS₀+Σ

OP_i=QO_i 

 

equation (4),

where Σ

OP is the cumulative total of all ongoing principal (IP) and allowable administration charges and costs paid by a lender in direct relation to a particular agreement between the lender and borrower.

3. An automated method according to claim 1 further comprising the step of inserting into a table a lender'"'"'s horizon gain allocation value (HGAV) at time i in order to run a lender redemption value (LRV) algorithm according to:

(ADV_i−

TB_i)HGA_i=HGAV_i 

 

equation (5),

wherein the lender redemption value algorithm is used to select between HGAV_i and QO_i and said lender redemption value algorithm may apply further weighting to both or either HGAV_i and QO_i prior to selecting between the two, such weighting being applied by way of a coefficient calculated in accordance with terms of one or more agreement between the borrower and the lender.

4. An automated method according to claim 1, further comprising the step of inserting into a table a maximum value for a capital guarantee all monies mortgage (CGAMM) where a value is set for capital guarantee at settlement “

CG₀”

, wherein,

(i) in the event of asset depreciation, the capital guarantee after settlement (CG_i) reduces to nil or a negative amount, as agreed between the borrower and lender; and

(ii) in the event of asset appreciation, the said CG_i increases with no upper limit and will be calculated with respect to the following limitations;

(A) at the date of settlement;

U₀+CG₀=ADV₀ 

 

equation (6),

where U₀ is the portion value of ADV₀ which will remain unencumbered and CG₀ is the maximum value of capital guarantee which could be applied at a time after the settlement date should the asset not appreciate in value and CG₀ is varied thereafter according to agreement between the borrower and lender, so that;

CG₀ will decrease proportionally to decrease in asset value until CG_i=0;

in which case;

U₀−

CG_i=U₀ 

 

equation (7)

and CG₀ will increase proportionally to appreciation in the ADV, so that;

CG₀+(x)HG_i=CG_i 

 

equation (8)

given that;

HG_i=ADV_i−

TB 

 

equation (9)

wherein

HG_i is the total horizon gain for the asset division,

and

(x) is a coefficient selected to determine the ratio at which CG_i will increase in relation to appreciation in ADV,

CG_i is varied on this basis until occurrence of a redemption event or occurrence of other event according to agreement between the borrower and lender.

5. An automated method according to claim 1, wherein, upon occurrence of a default event, a redemption event, assignment event, or any calculation which assigns a valuation to a lender'"'"'s all monies security under an agreement between the borrower and lender, and independent of the LRV algorithm, the maximum redemption value to a lender is determined as follows:

(i) where QO_i>

HGAV_i, the maximum redemption value to a lender is the lesser of CG₀ or QO_i;

(ii) where QO_i>

CG₀ and QO_i>

HGAV_i and (QO_i−

HGAV_i)<

CG₀, the maximum redemption value to a lender will be equal to QO_i;

(iii) where QO_i>

CG₀ and QO_i>

HGAV_i and (QO_i−

HGAV_i)>

CG₀, the maximum pay out (redemption) value to a lender will be (HGAV+CG₀);

(iv) where HGAV_i>

CG₀, and (QO_i−

HGAV_i)<

CG₀, the maximum redemption value to a lender is the greater of HGAV or QO as determined by the “

greater of rule”

; and

(v) where HGAV_i>

CG₀ and HGAV_i>

QO_i, the maximum redemption value to a lender would be the greater of HGAV or QO_i as determined by the “

greater of rule”

.

6. A computer system implementing a method according to claim 1.

10. Apparatus adapted to predict income derived from an anticipated future benefit (Horizon Gain) in a data processing system, said apparatus comprising:

processor means adapted to operate in accordance with a predetermined instruction set,

said apparatus, in conjunction with said instruction set, being adapted to perform the method as claimed in claim 1.

11. A computer program product comprising:

a computer usable medium having computer readable program code and computer readable system code embodied on said medium for predicting income derived from an anticipated future benefit (Horizon Gain) within a data processing system, said computer program product comprising;

computer readable code within said computer usable medium for performing the steps of claim 1.

12. An automated method according to claim 2 further comprising the step of inserting into a table a lender'"'"'s horizon gain allocation value (HGAV) at time i in order to run a lender redemption value (LRV) algorithm according to:

(ADV_i−

TB_iHGA_i=HGAV_i 

 

equation (5),

wherein the lender redemption value algorithm is used to select between HGAV_i and QO_i and said lender redemption value algorithm may apply further weighting to both or either HGAV_i and QO_i prior to selecting between the two, such weighting being applied by way of a coefficient calculated in accordance with terms of one or more agreement between the borrower and the lender.

13. A computer system implementing a method according to claim 2.

14. A computer system implementing a method according to claim 3.

15. A computer system implementing a method according to claim 4.

16. A computer system implementing a method according to claim 5.

17. A computer system implementing a method according to claim 12.

22. Apparatus adapted to predict income derived from an anticipated future benefit (Horizon Gain) in a data processing system, said apparatus comprising:

processor means adapted to operate in accordance with a predetermined instruction set, said apparatus, in conjunction with said instruction set, being adapted to perform the method as claimed in claim 2.

23. Apparatus adapted to predict income derived from an anticipated future benefit (Horizon Gain) in a data processing system, said apparatus comprising:

processor means adapted to operate in accordance with a predetermined instruction set, said apparatus, in conjunction with said instruction set, being adapted to perform the method as claimed in claim 3.

24. Apparatus adapted to predict income derived from an anticipated future benefit (Horizon Gain) in a data processing system, said apparatus comprising:

processor means adapted to operate in accordance with a predetermined instruction set, said apparatus, in conjunction with said instruction set, being adapted to perform the method as claimed in claim 4.

25. Apparatus adapted to predict income derived from an anticipated future benefit (Horizon Gain) in a data processing system, said apparatus comprising:

processor means adapted to operate in accordance with a predetermined instruction set, said apparatus, in conjunction with said instruction set, being adapted to perform the method as claimed in claim 5.

26. Apparatus adapted to predict income derived from an anticipated future benefit (Horizon Gain) in a data processing system, said apparatus comprising:

processor means adapted to operate in accordance with a predetermined instruction set, said apparatus, in conjunction with said instruction set, being adapted to perform the method as claimed in claim 12.

27. A computer program product comprising:

a computer usable medium having computer readable program code and computer readable system code embodied on said medium for predicting income derived from an anticipated future benefit (Horizon Gain) within a data processing system, said computer program product comprising;

computer readable code within said computer usable medium for performing the steps of claim 2.

28. A computer program product comprising:

a computer usable medium having computer readable program code and computer readable system code embodied on said medium for predicting income derived from an anticipated future benefit (Horizon Gain) within a data processing system, said computer program product comprising;

computer readable code within said computer usable medium for performing the steps of claim 3.

29. A computer program product comprising:

a computer usable medium having computer readable program code and computer readable system code embodied on said medium for predicting income derived from an anticipated future benefit (Horizon Gain) within a data processing system, said computer program product comprising;

computer readable code within said computer usable medium for performing the steps of claim 4.

30. A computer program product comprising:

a computer usable medium having computer readable program code and computer readable system code embodied on said medium for predicting income derived from an anticipated future benefit (Horizon Gain) within a data processing system, said computer program product comprising;

computer readable code within said computer usable medium for performing the steps of claim 5.

31. A computer program product comprising:

a computer usable medium having computer readable program code and computer readable system code embodied on said medium for predicting income derived from an anticipated future benefit (Horizon Gain) within a data processing system, said computer program product comprising;

computer readable code within said computer usable medium for performing the steps of claim 12.

7. A computer system for predicting income derived from an anticipated future benefit (Horizon Gain), wherein the system comprises:

(a) first registration means for registering characteristics associated with a borrower in a first database;

(b) second registration means for registering characteristics associated with a lender in a second database;

(c) first automated means including user fields for inputting the following values to a first database;

(i) an initial value for an asset owned by a borrower, wherein the asset may increase or decrease in value over time,

(ii) a Horizon Gain Allocation percentage, expressed in favour of a lender,

(iii) the lender'"'"'s target return value,

(iv) a gearing factor, wherein the system to forecast a potential growth in asset value and therefore a Horizon Gain Allocation Value (HGAV) for any future time interval, for the gearing factor entered, and

(v) a value representing the number and size of Asset Divisions (AD);

(d) automated means for generating a second database and subsequent databases as necessary populated with values for one or more selected future time divisions for the borrower'"'"'s asset over one or more AD'"'"'s before optimisation, the values being as follows and calculated according to the following formulae;

(i) an agreed periodic payment from the lender to the borrower based on an ongoing principal value (IP) calculated according to;

TB₀×

HGA_i×

R×

MRCc₀=IP 

 

equation (1),

wherein

MRCc₀ is a mandatory redemption criteria coefficient,

R is a coefficient chosen to optimize IP based on nominated lender and borrower returns at year n and borrower selected variables,

HGA_i is a horizon gain allocation proportion at time=i expressed in favour of the lender, and

TB₀ is the transaction base calculated from the asset value according to

ADV₀−

(M)TC₀−

(P)LS₀=TB₀ 

 

equation (2),

wherein

TC₀ comprises transaction costs,

M is a coefficient chosen to weight the significance in value of TC₀,

P is a coefficient chosen to weight the significance in value of LS₀,

LS₀ comprises any lump sum payment including any premium loading made by the lender, and

ADV₀ is the asset division value calculated from the equation;

AV₀×

ADP=ADV₀ 

 

equation (3),

wherein

ADP is the asset division proportion input by a user, and

AV₀ is the whole of asset value,

and

(ii) an amount payable to a lender upon occurrence of a redemption event, calculated by selecting the greater of;

an agreed proportion of appreciation of the asset (HGAV), or

qualifying outgoings (QO),

wherein the value of QO and HGAV is first adjusted by multiplication with a coefficient calculated or selected in relation to borrower or lender criteriaM

(e) visual display means for creating visual depictions based on the values in the database or databases to represent predicted income derived from the anticipated future benefit and

(f) automated means for responding to a redemption event by determining the value of a payment to the lender that is the greater of;

(i) an agreed proportion of appreciation of the asset (HGAV), or

(ii) qualifying outgoings (QO).

8. A computer implemented system according to claim 18, which includes an automated means for establishing lenders qualifying outgoings (QO) value at time i according to equation (4).

9. A computer implemented system according to claim 19, which includes an automated means for establishing a lenders horizon gain allocation value at time i according to equation (5).

18. A computer system according to claim 7, further comprising means for inserting into a table a lenders qualifying outgoings (QO) value at time i calculated according to:

(M)TC_i+(P)LS₀+Σ

OP_i=QO_i 

 

equation (4),

where Σ

OP is the cumulative total of all ongoing principal (IP) and allowable administration charges and costs paid by a lender in direct relation to a particular agreement between the lender and borrower.

19. A computer system according to claim 7, further comprising means for inserting into a table a lender'"'"'s horizon gain allocation value (HGAV) at time i in order to run a lender redemption value (LRV) algorithm according to:

(ADV_i−

TB_i)HGA_i=HGAV_i 

 

equation (5),

wherein the lender redemption value algorithm is used to select between HGAV_i and QO_i and said lender redemption value algorithm may apply further weighting to both or either HGAV_i and QO_i prior to selecting between the two, such weighting being applied by way of a coefficient calculated in accordance with terms of one or more agreement between the borrower and the lender.

20. A computer system according to claim 18, further comprising means for inserting into a table a lender'"'"'s horizon gain allocation value (HGAV) at time i in order to run a lender redemption value (LRV) algorithm according to:

(ADV_i−

TB_i)HGA_i=HGAV_i 

 

equation (5),

wherein the lender redemption value algorithm is used to select between HGAV_i and QO_i and said lender redemption value algorithm may apply further weighting to both or either HGAV_i and QO_i prior to selecting between the two, such weighting being applied by way of a coefficient calculated in accordance with terms of one or more agreement between the borrower and the lender.

21. A computer implemented system according to claim 20, which includes an automated means for establishing a lenders horizon gain allocation value at time i according to equation (5).