A graduated payment mortgage (GMP) developed to overcome the negative amortization aspects of the GMP. The key to the FLIP mortgage is the use of the buyer's down payment. Instead of being used as s down payment, the cash is deposited in a pledged, interest-bearing savings account where it serves as both a cash collateral for the lender and as a source of supplemental payments for the borrower during the first few years of the loan. The supplemental payment decrease each month and vanishes at the end of a predetermined period. By using this type of program, a borrower is likely to qualify for a larger loan than with a conventional fully-amortized mortgage.