System and method for implementing a mortgage plan
First Claim
1. A method of using a computer system for implementing a mortgage plan and preparing mortgage documents specifying payment obligations of a borrower to a lender concerning an asset which is subject to a mortgage, the mortgage plan including an equity participation mortgage obligation in which the borrower is obligated to share with the lender a predetermined percentage of realized appreciation upon sale of the asset, comprising the steps of:
- inputting data into the computer system regarding the terms of the mortgage, including the principal amount and an amortization period;
using the computer system to calculate annual average principal and periodic payment obligations of the borrower accruing under the mortgage obligation; and
using the computer system to prepare one or more mortgage documents which specify the equity participation mortgage obligation, including a compensation component returned to the lender and a principal repayment component, that timing of equity participation is indeterminable and is controlled by the borrower, and that the lender shares in a predetermined percentage of realized appreciation on subsequent sale of the asset which is the subject of the mortgage.
1 Assignment
0 Petitions
Accused Products
Abstract
A system and method for implementing a mortgage plan. Data is input to a computer system regarding the mortgage terms, and the computer system is used to prepare a mortgage document which creates an equity participation mortgage obligation in which the lender shares in a predetermined percentage of realized appreciation on the subsequent sale of the asset which is the subject of the mortgage. In a particularly preferred embodiment, this mortgage plan can provide the borrower with an interest-free loan, a faster amortization schedule, and a larger, yet more affordable mortgage. The lender also receives substantial benefits, including the potential for a return which exceeds conventional mortgage rate returns, insulation from risk against interest rate fluctuation, and preferred tax treatment in the form of capital gains tax rates paid only upon the subsequent sale of the mortgaged asset. No maturity date need be specified for the mortgage; rather, it may be tied to the ultimate sale of the asset subject to the mortgage.
41 Citations
22 Claims
-
1. A method of using a computer system for implementing a mortgage plan and preparing mortgage documents specifying payment obligations of a borrower to a lender concerning an asset which is subject to a mortgage, the mortgage plan including an equity participation mortgage obligation in which the borrower is obligated to share with the lender a predetermined percentage of realized appreciation upon sale of the asset, comprising the steps of:
-
inputting data into the computer system regarding the terms of the mortgage, including the principal amount and an amortization period;
using the computer system to calculate annual average principal and periodic payment obligations of the borrower accruing under the mortgage obligation; and
using the computer system to prepare one or more mortgage documents which specify the equity participation mortgage obligation, including a compensation component returned to the lender and a principal repayment component, that timing of equity participation is indeterminable and is controlled by the borrower, and that the lender shares in a predetermined percentage of realized appreciation on subsequent sale of the asset which is the subject of the mortgage. - View Dependent Claims (2, 3, 4, 5, 6, 7, 8, 9)
-
-
10. A computer system for implementing a mortgage plan and preparing mortgage documents specifying payment obligations of a borrower to a lender concerning an asset which is subject to a mortgage, the mortgage plan including an equity participation mortgage obligation, comprising:
-
at least one computer including a central processing unit and a memory, for receiving data regarding the terms of the mortgage, including the principal amount and an amortization period, within the computer system;
the at least one computer calculating annual average principal and periodic payment obligations of the borrower accruing under the mortgage obligation, and preparing one or more mortgage documents which include the equity participation mortgage obligation and which specify that the lender shares in a predetermined percentage of realized appreciation on subsequent sale of the asset which is subject to the mortgage, and that timing of equity participation with the lender is indeterminable and is controlled by the borrower.
-
-
11. A method of using a computer system for implementing a mortgage plan and preparing one or more mortgage documents specifying payment obligations of a borrower to a lender concerning an asset which is subject to a mortgage having a maturity date, the mortgage plan specifying an equity participation mortgage obligation in which the lender receives a predetermined portion of realized appreciation in the asset during the life of the mortgage, comprising the steps of:
-
inputting data into the computer system regarding the terms of the mortgage, including the principal amount and an amortization period;
calculating annual average principal and periodic payment obligations of the borrower accruing under the mortgage obligation; and
preparing the one or more mortgage documents, the one or more mortgage documents specifying;
the equity participation mortgage obligation;
that the lender shares in a predetermined percentage of the realized appreciation on subsequent sale of the asset which is the subject of the mortgage;
that timing of equity participation with the lender is indeterminable and is controlled by the borrower; and
that prior to sale or maturity of the asset, the amount of principal paid by the borrower pursuant to the mortgage exceeds the amount of current interest paid by the borrower. - View Dependent Claims (12, 13, 14, 15, 16)
-
-
17. A method of using a computer system for implementing a mortgage plan and for preparing one or more mortgage documents specifying payment obligations of a borrower to a lender concerning an asset which is subject to a mortgage, the mortgage plan specifying an equity participation mortgage obligation in which the lender receives a predetermined portion of realized appreciation in the asset during the life of the mortgage, comprising the steps of:
-
inputting data into the computer system regarding the terms of the mortgage, including the principal amount and an amortization period;
calculating annual average principal and periodic payment obligations of the borrower accruing under the mortgage obligation; and
preparing the one or more mortgage documents, the one or more mortgage documents specifying;
the equity participation mortgage obligation;
that the lender shares in a predetermined percentage of the realized appreciation on subsequent sale of the asset which is the subject of the mortgage; and
that timing of equity participation with the lender is indeterminable and is controlled by the borrower;
wherein the lender receives capital gain tax treatment on its portion of the realized appreciation of the asset upon the sale or transfer of the asset. - View Dependent Claims (18, 19, 20)
-
-
21. A method of using a computer system for implementing a mortgage plan and for preparing one or more mortgage documents specifying payment obligations of a borrower to a lender concerning an asset which is subject to a mortgage which need not have a maturity date, the mortgage plan specifying an equity participation mortgage obligation in which the lender receives a predetermined portion of realized appreciation in the asset during the life of the mortgage, comprising the steps of:
-
inputting data into the computer system regarding the terms of the mortgage, including the principal amount and the amortization period;
calculating annual average principal and periodic payment obligations of the borrower accruing under the mortgage obligation; and
preparing the one or more mortgage documents, the one or more mortgage documents specifying;
the equity participation mortgage obligation;
that the lender shares in a predetermined percentage of the realized appreciation on subsequent sale of the asset which is subject to the mortgage;
that timing of equity participation with the lender is indeterminable and is controlled by the borrower; and
that prior to sale or transfer of the asset, the entire amount of the mortgage payments made by the borrower are applied to the principal amount.
-
-
22. A method of using a computer system for implementing a mortgage plan and preparing mortgage documents specifying payment obligations of a borrower to a lender concerning an asset which is subject to a mortgage, the mortgage plan including an equity participation mortgage obligation in which the borrower is obligated to share with the lender a predetermined percentage of realized appreciation upon sale of the asset, comprising the steps of:
-
inputting data into the computer system regarding the terms of the mortgage, including the principal amount and an amortization period;
using the computer system to calculate annual average principal and periodic payment obligations of the borrower accruing under the mortgage obligation; and
using the computer system to prepare one or more mortgage documents which specify the equity participation mortgage obligation, including a compensation component returned to the lender and a principal repayment component, that timing of equity participation is controlled by the borrower, and that the lender shares in a predetermined percentage of realized appreciation on subsequent sale of the asset which is the subject of the mortgage.
-
Specification