Shared Appreciation Mortgage (SAM)
Definition of "Shared Appreciation Mortgage (SAM)"
A type of equity participation loan where, in exchange for charging a below-market interest rate, the lender receives a predetermined percentage of a any increase in value of the property over a specified period of time. To illustrate, a lender who would otherwise charge 10% interest, might agree to take &% interest plus one-third of the appreciation of the property. For the lender, the money received from the appreciation of the property increases the effective yield on the investment. The borrower, by agreeing to share appreciation in property value gets a lower interest rate, which in turn reduces the monthly mortgage payment. A SAM is normally written so that at the end of the shared appreciation period, the property will be appraised and the amount due to the lender through appreciation is due at that time.
Popular Real Estate Terms
Upon satisfaction of a mortgage or other debt payments, the deed releases property, or a portion of it, form the incumbrance. Often it is used in circumstances where a deed of trust is ...
Neighborhood square somewhat resembling a park. It is often owned by town or row house owners situated near the square. ...
One who represents a zone such an elected leader of a region. He or she have dealings with the county's officials in matters affecting that zone. ...
Products, services, markets, and even humans are often subject to swift and unpredictable changes that go against all previous expectations. In other words, they’re volatile. What is ...
Measure of the typical U.S. family's ability to buy a home, published by the National Association of Realtors. When the Index measures 100, a family earning the median income has exactly ...
The escrow fee is basically how the escrow agent or manager get his/her compensation for assisting and handling both the parties and the funds involved in escrow. In real estate, the ...
Map showing the kinds of soil in a designated locality. ...
Increase in the amount of money available for businesses and people to by real estate because of lower interest rates. Easy money stimulates spending on investment such as houses. See also ...
Net return rate earned on an equity investment in real estate after deducing any interest costs and taxes. ...
Have a question or comment?
We're here to help.