Posted: Wed Apr 12, 2006 7:17 am Post subject: New mortgage product -available?
This may seem like a solicitation, but at the core it is a question that I am looking for some feedback on from mortgage industry pros. I am in the process of submitting a provisional patent application for an idea and concept I have for a new mortgage product.
In your opinion, what might the residential market interest be in a home loan that:
1. Is similar to a bi-weekly payment plan as far as extra principal paid down- with less out of pocket yearly costs.
2. About 80-90% of the time would be a fixed rate for the homeowner.
3. Is commercially viable for a bank or lending institution, in much the same way that offering a mutual fund would be. The bank would not make a killing on each deal, but they would cover all expenses- plus make at least a "few" dollars.
Sorry for the long-winded message, but I wanted to get the main points across. I appreciate any and all responses.
Thank you,
Ken L. (New Hampshire)
Thanks for the link to Nationwide-UK. Their product just seems like a basic ARM with a caveat that you can switch back and forth between a fixed loan and an ARM for little or no refinance costs or prepay penalties. That seems interesting, but it is not what my idea is. My idea, under normal or typical market conditions, would benefit the homeowner by paying down about 50% more than a typical 30 year FRM for the first 7 years or so. The downside is that it COULD result in a larger monthly interest payment at certain times- only if the market would dictate. There is a small risk,for them vs a 30 year FRM, and that is why I wanted to see what people's perceptions might be. Thanks- _________________ For some interesting insight, please check out my Blog @ http://homequitybuilder.mortgagefit.com
Or visit my website at www.homequitybuilder.info
Hello James and All- Forgive me if I can't get into the specifics at this time. At least not for another couple of weeks until the paperwork is done and dated for the US Patent Office.
I have done a lot of research and statistical calcs and business samples. I would be happy to get into more detail with whomever if they'd like to contact me directly at 'kdlambert2@aol.com.
The people that I'm looking to speak with or get feedback from are mortgage brokers, loan processors, and bank executive-types. Any of these people could/would benefit just due to more sales volume, etc. The homeowner would almost certainly benefit; If the product existed now, I would jump on it.
I didn't want to take up a lot of air time with the community board. My general question is really "Would John Doe homeowner risk potentially paying an extra $1000 per year in interest if there is a very strong chance that after 3, 5, 7 years etc they would have paid off much more ($5000-$17000) on their principal balance?
Thanks a lot- _________________ For some interesting insight, please check out my Blog @ http://homequitybuilder.mortgagefit.com
Or visit my website at www.homequitybuilder.info
Although it depends on the individual situation but I think that paying down more on the principal will always be appreciated by the homeowner as part of his headaches gets removed.
But again it depends on his current affordability and some other factors. Anyways best of luck.
As with any mortgage "product" there must be benefits for both the consumers and the lenders.
Once you have documented your patent filing, please feel free to share this information in full detail to my e-mail address of 'Bill@StateStreetMortgage.Net' if you are still looking for feedback.
Best of Luck!
edited per forum rules _________________ Bill Clanton is a Mortgage Specialist and Manager of State Street Mortgage of Illinois. StateStreetMortgage.Net
kenl314
