Reverse mortgage loan calculation system and process

Data processing: financial – business practice – management – or co – Automated electrical financial or business practice or... – Finance

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Details

705 1, 705 38, 705 35, 395238, 395236, G06F15700, G06F 1760

Patent

active

059917458

ABSTRACT:
A system and process of calculating monetary payments by a lender to a borrower based on the value of an asset using at least one of a plurality of constants stored in look-up tables. The process includes inputting borrower information such as borrower birthdate or age. Property specific information is input, such as appraised property value. Equity share information is also input. With the Equity share information and borrower age, the process looks-up a tenure conversion factor from a look-up table. The loan type is input as one of tenure, line of credit, and modified tenure and appropriate variables are set accordingly. The principal limit factor is read from a look-up table and the original principal limit is calculated to be equal to the principal limit factor multiplied by the appraised property value. Next the net principal limit is calculated as the original principal limit minus costs. The loan is then calculated--if tenure, then the monthly payment equals net principal limit times tenure conversion factor, if line of credit, then the net principal limit equals the line of credit, and if modified tenure, then net line of credit equals net principal limit minus (monthly payment divided by tenure conversion factor), when a monthly payment amount was requested or monthly payment equals (net principal limit minus net line of credit) multiplied by tenure conversion factor when a net line of credit was requested.

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New York State Banking Department, Reverse Mortgage Loan, http://www.banking.state.ny.us/rml.htm, Aug. 1996.
James R. DeBoth, A reverse mortgage can offer a source of income during retirement years, http://www.interest.com/sa960807.htm, 1995.
AgeNet, Reverse Mortgages, http://www.agenet.com/reverse.sub.-- mortgages.html, 1997.

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