System and method for automatically investing a portion of interest charged in a mortgage installment payment

Abstract

A method and a system are provided to allocate a borrower's monthly home loan repayments to a loan provider to an interest payment account and an equity accrual account; and, to further allocate to a retirement or education account a monthly amount of savings that is correlated to that portion of each monthly home loan repayment comprising interest on the loan. The monthly amount of savings allocated to the retirement or education account is computed by multiplying that portion of each monthly home loan repayment comprising interest on the loan by a savings rate that is a function of an economic benchmark.

1 - 68 . (canceled) 
     
     
         69 . A method for repayment of a home loan secured by a mortgage that simultaneously funds an investment account, comprising:
 providing a computer having a memory with associated data input/output and processing means for automatically debiting a monthly savings amount $MSA from a monthly interest payment and allocating the monthly savings amount $MSA to the investment account, and thereafter automatically allocating and crediting the remaining monthly interest payment to the interest payment account and the monthly principal repayment to the equity accrual account.   
     
     
         70 . The method according to  claim 69 , wherein the investment account is a traditional Individual Retirement Account (IRA). 
     
     
         71 . The method according to  claim 69 , wherein the investment account is a Roth IRA. 
     
     
         72 . The method according to  claim 69 , wherein the investment account is a Spousal IRA. 
     
     
         73 . The method according to  claim 69 , wherein the investment account is a Group IRA. 
     
     
         74 . The method according to  claim 69 , wherein the investment account is an SEP IRA. 
     
     
         75 . The method according to  claim 69 , wherein the investment account is a SIMPLE IRA. 
     
     
         76 . The method according to  claim 69 , wherein the investment account is an Education IRA. 
     
     
         77 . The method according to  claim 69 , wherein the investment account is a 401(K) Plan. 
     
     
         78 . The method according to  claim 69 , wherein the investment account is a 403(b) Plan. 
     
     
         79 . The method according to  claim 69 , wherein the investment account is a 457 Plan. 
     
     
         80 . The method according to  claim 69 , wherein the investment account is a Keogh Plan. 
     
     
         81 . The method according to  claim 69 , wherein the monthly savings amount $MSA is computed by multiplying a monthly interest payment $MINT by a savings rate S(B) that is a function of at least one economic benchmark rate (B), according to the following equation (1):
   $ MSA=S ( B )×$MINT   (equation 1).
   
     
     
         82 . The method according to  claim 81 , wherein the savings rate S(B) is a function of a benchmark rate B and an applicable interest rate A on the mortgage. 
     
     
         83 . The method of  claim 81 , wherein the savings rate S(B) is computed by the processing means to be the ratio obtained when the difference between the applicable interest rate A on the mortgage and the augmented benchmark rate B A  is divided by the applicable interest rate A on the mortgage, according to the following equation (3):
     S ( B )=( A−B   A )/ A    (equation 3).
   
     
     
         84 . The method of  claim 81 , wherein the savings rate S(B) is computed by the processing means to be the ratio obtained when the difference between the augmented benchmark rate and the benchmark rate is divided by the augmented benchmark rate, according to the following equation (9):
     S ( B )=( B   A   −B )/ B   A    (equation 9).
   
     
     
         85 . The method of  claim 81 , wherein the savings rate is calculated as the difference between a second Benchmark Rate B 2  and a first Benchmark Rate B 1 , divided by the second Benchmark Rate B 2 , according to equation (14):
     S ( B   1   , B   2 )=( B   2   −B   1 )/ B   2    (equation 14).
   
     
     
         86 . The method according to  claim 81 , wherein the benchmark rate B is selected from the group consisting of:
 a) United States Federal Funds Rate;   b) 5 Year United States Treasury Note Yield;   c) 10 Year United States Treasury Note Yield;   d) 30 Year United States Treasury Bond Yield;   e) London Interbank Offered Rate;   f) Mortgage-Backed Security Yield;   g) National Average Mortgage Interest Rate 30 Year Fixed Rate Mortgage;   h) National Average Mortgage Interest Rate 20 Year Fixed Rate Mortgage;   i) National Average Mortgage Interest Rate 15 Year Fixed Rate Mortgage;   j) National Average Mortgage Interest Rate 3/1 Adjustable Rate Mortgage;   k) National Average Mortgage Interest Rate 5/1 Adjustable Rate Mortgage;   l) National Average Mortgage Interest Rate 7/1 Adjustable Rate Mortgage;   m) National Average Mortgage Interest Rate 7/1 Convertible Adjustable Rate Mortgage;   n) National Average Mortgage Interest Rate Interest-only 30 Year Fixed Rate Mortgage;   o) National Average Mortgage Interest Rate Interest-only 20 Year Fixed Rate Mortgage;   p) National Average Mortgage Interest Rate Interest-only 15 Year Fixed Rate Mortgage;   q) National Average Mortgage Interest Rate Interest-only 3/1 Adjustable Rate Mortgage;   r) National Average Mortgage Interest Rate Interest-only 5/1 Adjustable Rate Mortgage;   s) National Average Mortgage Interest Rate Interest-only 7/1 Adjustable Rate Mortgage;   t) Regional, State, or Local Average Mortgage Interest Rate;   u) Averages for 2/28 Adjustable Rate Mortgages; and   v) State-sponsored mortgage interest rates.   
     
     
         87 . The method of  claim 86 , wherein the selected benchmark rate B is augmented by a premium ΔB to form an augmented benchmark rate B A , according to the following equation (8):
     B   A   =B+ΔB    (equation 8).
 
 
     
     
         88 . A system for repayment of a home loan secured by a mortgage that simultaneously funds an investment account, comprising:
 a computer having a memory with associated data input/output and a processing means for automatically debiting a monthly savings amount $MSA from a monthly interest payment and allocating the monthly savings amount $MSA to the investment account, and thereafter automatically allocating and crediting the remaining monthly interest payment to the interest payment account and the monthly principal repayment to the equity accrual account.