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.
