Patent ID: 8712908

Claim:
A computer-implemented method for issuing and servicing a home appreciation participation note (HAPN) for a real estate property, comprising: initiating a participation contract (PC) for the real estate property, and issuing the PC to a PC investor for a PC price; specifying, for a valuation of the PC, a proxy and a set of sharing formulae, a payoff value of the PC at a time of a settlement of the HAPN being specified by the set of sharing formulae using a value of the proxy at the settlement time, the value of the proxy at the settlement time being ascertainable by running an automated valuation model (AVM) on a computer using a plurality of attributes specific to the real estate property, the plurality of attributes being of a condition of the real estate property prior to the settlement time, and being independent of an actual condition of the real estate property at the settlement time; and issuing a HAPN Bond for the real estate property to a HAPN Bond investor, the HAPN Bond having an initial value being a sum of the PC price and a discounted amount of the initial value of the HAPN Bond; wherein both the PC and the HAPN Bond represent claims on the real estate property, and are paid off respectively to the PC and HAPN Bond investors at the settlement time; a payoff amount of the PC to the PC investor at the settlement time corresponds to the payoff value of the PC at the settlement time; and a payoff amount of the HAPN Bond to the HAPN Bond investor at the settlement time is the initial value of the HAPN Bond if the payoff value of the PC at the settlement time is not negative, and is a remaining portion of the initial value, after deducting the absolute value of the payoff value of the PC at the settlement time, if the payoff value of the PC at the settlement time is negative.