Shared Appreciation

Ocwen Financial Corp. has initiated an equity-sharing loan modification program designed to assist underwater borrowers. Under the Shared Appreciation Modification (SAM) program, which Ocwen began piloting last August, the principal of a delinquent loan is written down to 95% of the current market value of the home. The written-down portion is forgiven in one-third increments over the next three years, provided the borrower stays current on his or her mortgage. When the house is later sold or refinanced, the borrower must share 25% of the appreciation with the investors that own the loan.


http://www.globenewswire.com/newsarchive/ocn/ocn_news.html


http://realtormag.realtor.org/daily-news/2011/07/27/bank-we-ll-reduce-your-loan-you-share-future-appreciation