 Sam
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Joined: 21 May 2005
Posts: 281
Location: CALIFORNIA
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 Posted: Tue Jul 06, 2004 4:05 am Post subject: Participation Mortgage |
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Participation Mortgage is a type of mortgage, which is made by one or more lender. It allows the lenders to participate in receiving payments of principal and interest and to have a share in resale proceeds.
Features Of Participation Mortgage :
- Financial Vehicle - It is an excellent financial vehicle. It provides a medium for long term financing. It helps the borrower in buying or building commercial or industrial property.
- Partial Equity - Here, a lender has partial equity interest in the property.
- Negotiable Loan Term - A borrower is provided with a negotiable loan term.
- Competitive Interest Rate - It offers competitive interest rate, which always fluctuates with the market trend.
- Requires Mortgage Division - It requires division of mortgage into units that are sold to one or more lenders.
- Multiple Ownership -It involves ownership of a portion of single mortgage or package of mortgages, by two or more lenders or investors.
- Low Risk Investment - It is a low risk investment mortgage. Here, the lender's money is pooled and placed in a 'portfolio of loans' to reduce the risk to each individual lender.
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