Patent ID: 6671677
Filing Date: 2003-12-30
Classification: G06Q

Abstract:
A method for reducing at least one of insurance rates and insurance premiums associated with a financial product, comprising the steps of:determining an original loan-to-value (LTV) ratio of a financial product, said financial product having an amount and an interest rate associated therewith, wherein said financial product necessitates a purchase of insurance for said financial product when said original LTV ratio exceeds a first pre-determined level, and wherein a first insurance premium would be charged for said insurance if said first insurance premium were based on said original LTV ratio; adding a cost of a buydown to the amount of said financial product, wherein said interest rate of said financial product is reduced as a result of said buydown; achieving a gross LTV ratio that is increased from said original LTV ratio as a result of adding the cost of said buydown to the amount of said financial product, wherein, when said gross LTV ratio exceeds a second pre-determined level as a result of the added cost of said buydown, the first insurance premium charged would be increased to a second insurance premium higher than the first insurance premium and corresponding to said gross LTV ratio if said gross LTV ratio were used to determine the insurance premium that should be charged for said insurance; and offering said insurance for the first insurance premium based on said original LTV ratio rather than on said gross LTV ratio, thereby effectively reducing the insurance premium charged for said insurance from the second insurance premium to the first insurance premium, wherein the first insurance premium at which said insurance is offered is determined through usage of a computer.