Method for calculation of a reduced interest mortgage payment plan
OwnerJay M. Bergerinventor
Life of this patent
Estimating the term…
Abstract
A “principal priority reduction” mortgage which provides both a method to reduce interest paid at a given interest rate and to increase a homeowner's equity rapidly in an otherwise conventional loan scenario. Included is a method for calculating and implementing same. Loan payments are applied to principal due first, while interest accrues and is paid only after the full reduction of the principal. The method may provide an investment vehicle which has particular interest to a certain category of montage investor.
Claims2
A method of implementing a fixed term loan repayment plan which comprises:
- determining an amount of loan principal to be provided;
- calculating a repayment schedule based on a conventional loan amortization table for a given interest rate, repayment term and the selected principal amount;
- providing a repayment schedule which applies such monthly payments to repayment of principal due on said loan first;
- accumulating interest payable and adding such to the principal amount due;
- and
- applying said term payments to reduction of interest due only after the principal has been repaid.
A method of lending money which provides for a deferment of interest received by the lender comprised substantially of the steps of:
- calculating a principal amount to be lent to a borrower;
- and
- deciding a fixed monthly payment amount which will allow reduction of the principal amount each payment period while applying each payment to the reduction of principal of the loan only, calculating monthly interest and carrying said amount forward in the principal balance, and applying such term payments to interest only after all the principal amounts of said loan have been paid first.
Dependencies are inferred from the claim text.