A system and method of relief and an alternative to foreclosure of real estate mortgage

Abstract

A system and method for developing a secondary market for transferring and acquiring mortgages is disclosed. The system offers an alternative to the expensive and wasteful proposition of foreclosures. Using the disclosed system, mortgagees holding a security interest in distressed properties can harness the power of computer technology and intelligent processing of data to rapidly perform actuarial analysis and generate documents that enable interested buyers to acquire mortgages through a mortgage transfer process. The system disclosed creates a secondary market of transferrable mortgages and is designed to be beneficial for new buyers where the equity in the existing mortgage is used for down-payment; or excess equity is used to make a one time payment to the original property owner. The system disclosed offers benefits to all key players—investors, banks, purchasers and realtors, and prevents waste and enables distressed properties to command their market value.

What is claimed is: 
     
         1 . A system for automated mortgage transfer, the system comprising:
 an input device adapted to receive property data including a predefined set of features for a property, wherein the input device includes a first communication link adapted to transmit the property data to a computing server;   an output device adapted to display or print a classification value for the property data, wherein the output device includes a second communication link adapted to receive the classification value from the computing server;   the computing server including a processor, a database, a memory, an input module, and an output module,   wherein the input module is adapted to receive the property data from the input device over the first communication link and save it to a first memory location,   the database having a plurality of model property data, wherein each of the plurality of model property data includes
 a plurality of values for the predefined set of features, and 
 a classification value, 
   the processor to perform operations including:
 estimating and storing in a second memory location a plurality of metric values for each of the plurality of model property data where the metric value measures a similarity between the property data and the model property data, 
 comparing data in the second memory location and storing into a third memory location those model property data values that satisfy a predefined condition, 
 computing an aggregate classification value from the plurality of model property classification values stored in the third memory location, assigning the aggregate classification value as the classification value for the property, and 
 communicating the classification value to the output module 
 wherein the output module is adapted to transmit the classification value output device; and 
 the output device adapted to display or print the classification value for the property data. 
   
     
     
         2 . The system of  claim 1 , wherein the feature values of the plurality of model properties are clustered into groups. 
     
     
         3 . The system of  claim 2 , the operations further comprising:
 calculating a mean cluster feature vector for the plurality of model properties that belong to a cluster;   calculating a distance metric between the real property feature vector and mean cluster feature vector for each of the plurality of clusters;   searching for a smallest value of the distance metric and storing the classification label of the cluster with the smallest value in a storage location; and   assigning the classification label from the storage location to the real property; and communicating the classification value to the output module.   
     
     
         4 - 5 . (canceled) 
     
     
         6 . The system of  claim 1  wherein, the aggregate classification value is selected as a single optimal value. 
     
     
         7 . The system of  claim 1 , wherein the aggregate classification value is selected as a majority classification value of the classification values stored in the third memory location. 
     
     
         8 . The system of  claim 1  wherein, the classification values associated with each of the plurality of model properties is selected from a group consisting of Excellent, Good, and Poor. 
     
     
         9 - 15 . (canceled) 
     
     
         16 . A system for automated mortgage transfer, the system including a processor in communication with memory to provide operations including:
 receiving information on a plurality of mortgaged properties including a market value, a loan value, and a mortgage interest held by a mortgagee bank;   receiving information on a plurality of transferee purchasers;   receiving transfer offers from at least a portion of the plurality of transferee purchasers, wherein each of the offers includes a purchase price and a down payment;   estimating a transfer risk for each of the transfer offers,   selecting a transferee purchaser to receive a mortgage transfer offer document, wherein an acceptance of the mortgage transfer offer document by the winning transferee minimizes a foreclosure risk for the mortgagee bank; and   generating a communication link for conveying the mortgage transfer document to the selected transferee purchaser.   
     
     
         17 . The system of  claim 16 , wherein the operations further comprising estimating the risk for each transfer offer by an average over a risk for a preselected set of properties. 
     
     
         18 . The system of  claim 16 , wherein the mortgage transfer document is generated only when the foreclosure risk for the mortgagee bank is lower than a predefined threshold. 
     
     
         19 . The system of  claim 16 , wherein the offer placed by the purchaser is more than a loan value of the mortgaged property where the loan value is equal to the amount that is owed to the mortgagee bank. 
     
     
         20 . The system of  claim 16 , wherein the down payment placed by the purchaser is more than an equity value of the mortgaged property where the equity value for a property is defined as a difference between the market value and the loan value. 
     
     
         21 . A system for automated mortgage transfer, the system including a processor in communication with memory having first and second memory locations to provide operations including:
 selecting with the processor a mortgaged property record from a database containing a plurality of information on mortgaged records;   estimating using the processor a mortgage transfer risk for the selected mortgaged property record;   storing the mortgage property record and the mortgage transfer risk in the first memory location;   selecting using the processor a purchaser record from a database containing a plurality of purchaser records;   estimating using the processor a mortgage default risk for the selected purchaser record;   storing the purchaser record and the mortgage default risk in the second memory location;   estimating using the processor an overall mortgage transfer risk by combining the mortgage transfer risk in the first memory location and the mortgage default risk in the second memory location;   producing using the processor the mortgage transfer offer document for a mortgage transfer of the selected mortgaged property to the selected purchaser when the overall mortgage transfer risk is below a predefined value; and   transmitting using a communication link the mortgage transfer offer document to the selected purchaser.   
     
     
         22 . The system of  claim 21 , wherein the mortgage transfer risk of a selected mortgaged property is estimated by comparing to the mortgaged property to plurality of model properties with known mortgage transfer risk. 
     
     
         23 . The system of  claim 21 , wherein the mortgage default risk of the selected purchaser is inversely related to a credit rating of the selected purchaser. 
     
     
         24 . The system of  claim 21 , wherein the overall mortgage transfer risk is calculated as a mathematical product of the mortgage transfer risk of a selected mortgaged property and the mortgage default risk of the selected purchaser. 
     
     
         25 . The system of  claim 21 , wherein a Transfer Support Parameter is used as a basis for generating the mortgage transfer offer document based on at least one of:
 an amount offered by the selected purchaser offer,   a market value of the selected property,   a down-payment offered by the selected purchaser, and   an equity of in the selected property.   
     
     
         26 . The system of  claim 21 , wherein the mortgage transfer offer is a provisional transfer offer that is communicated to a plurality of selected purchasers with a first purchaser to accept the offer resulting in a conversion of the provisional offer to a firm offer for the first selected purchaser recipient and canceling the offer for other recipients of the provisional offer. 
     
     
         27 . The system of  claim 1 , the operations further including:
 matching a set of similar clusters to a new property vector; and   generating a mean feature vector based on an aggregate property for each cluster of the matched set of similar clusters.   
     
     
         28 . The system of  claim 16 , the operations further including:
 matching a set of similar clusters to a new property vector; and   generating a mean feature vector based on an aggregate property for each cluster of the matched set of similar clusters.   
     
     
         29 . The system of  claim 21 , the operations further including:
 matching a set of similar clusters to a new property vector; and   generating a mean feature vector based on an aggregate property for each cluster of the matched set of similar clusters.