Method and system for providing a loan using equity in a new home

Abstract

Systems and methods are disclosed for financing a transition of a borrower between ownership of a prior home to ownership of a new home in conjunction with services. The transition is associated with an increase in living situation cost of the borrower between a prior living situation cost and a new living situation cost, the new living situation cost including the new home and the services. The method alleviates cash flow burden to the borrower by allowing minimal or no monthly payments for as long as the borrower occupies the home.

What is claimed is: 
     
         1 - 28 . (canceled) 
     
     
         29 . A method to finance a transition of a borrower between ownership of a prior home to ownership of a new home in conjunction with services, the method comprising:
 determining the value of the prior home;   establishing, using a processing machine, at the time of purchase of the new home, a loan balance associated with the new living situation cost, the new living situation cost including:
 the cost to purchase the new home, and 
 the cost of the services, the services incurred by the borrower during occupation of the new home, and 
   wherein the loan balance includes periodic accumulated interest plus principle and constitutes collectable proceeds up to a value of the new home, such that the collectable proceeds is limited to a secured value of the new home; and   performing processing, by the processing machine, to use the value of the prior home as equity in the new home and as collateral for the collectable proceeds, and proceeds from sale of the prior home, based on the value of the prior home, being collected and passing into the equity of the new home so as to finance the transition of the borrower between ownership of the prior home to ownership of the new home in conjunction with the services; and   generating respective values, by the processing machine, to represent the equity in the new home and the collateral for the collectable proceeds;   the method constituted of financing a transition of a borrower between ownership of the prior home to ownership of the new home in conjunction with the services such that the transition is associated with an increase in living situation cost of the borrower between a prior living situation cost and the new living situation cost, the new living situation cost including the new home and the services, the method alleviating cash flow burden to the borrower resulting in minimal monthly payments for as long as the borrower occupies the new home.   
     
     
         30 . The method of  claim 29 , the value of the prior home is determined based on a sale of the prior home. 
     
     
         31 . The method of  claim 29 , the new home being purchased prior to the sale of the prior home. 
     
     
         32 . The method of  claim 31 , the value of the prior home is determined based on a sale of the prior home. 
     
     
         33 . The method of  claim 32 , further including using equity of the home as the secured value whereby the collectable proceeds at any point in time is limited to the lesser of the loan balance and the secured value of the home, the loan balance including at least one selected from the group consisting of principal, interest, and associated fees. 
     
     
         34 . The method of  claim 32 , further including effecting a first financing component, the first financing component including financing the new living situation cost, using the equity in the new home as collateral, beginning after one year from purchase of the new home by the borrower. 
     
     
         35 . The method of  claim 34 , further including effecting a second financing component, the second financing component including providing bridge financing for a first year that the borrower occupies the home. 
     
     
         36 . The method of  claim 35 , wherein the first financing component and the second financing component are financed in one transaction. 
     
     
         37 . The method of  claim 32 , financing the new living situation cost using the equity in the new home as collateral beginning immediately upon purchase of the new home. 
     
     
         38 . The method of  claim 32 , further comprising paying a cost gap to the borrower wherein the cost gap is the difference between the purchase price of the new home and the value of the prior home with the price of the new house being greater than the value of the prior house. 
     
     
         39 . The method of  claim 32 , wherein the proceeds of sale of the prior home is applied to purchase of the new home and/or the cost of the services. 
     
     
         40 . The method of  claim 32 , wherein the value of the prior home is determined based on a valuation of the prior home, prior to the sale of the prior home. 
     
     
         41 . The method of  claim 40 , wherein the new home is purchased prior to the sale of the prior home, the method further comprising funding, by a company, both (1) an amount based on the valuation of the prior home, and (2) a cost gap between value of the prior home vis-á-vis purchase price of a more expensive new home. 
     
     
         42 . The method of  claim 41 , the method further comprising paying the company funds resulting from sale of the prior home, the sale and the receiving funds occurring after the new home has been purchased and the loan balance is accruing. 
     
     
         43 . The method of  claim 40 , wherein the new home is purchased prior to the sale of the prior home, the method further comprising funding, by a company, both (1) an amount based on the value of the prior home, and (2) a cost gap between value of the prior home vis-á-vis the more expensive new living situation. 
     
     
         44 . The method of  claim 32 , wherein either (a) the new home is new to the borrower, and was previously owned by another, or (b) the new home is new construction such that the borrower is the first one to live in the house. 
     
     
         45 . The method of  claim 32 , wherein the method is implemented using a computer system. 
     
     
         46 . The method of  claim 45 , the computer system being maintained by a financial institution. 
     
     
         47 . The method of  claim 45 , the computer system being maintained by one of an insurance company and a bank. 
     
     
         48 . The method of  claim 32 , the purchase of the new home occurring simultaneously or almost simultaneously with setting up the financing of the new home via equity being used as collateral for the loan.