What is a Shared Appreciation Mortgage?

A Shared Appreciation Mortgage (SAM) is a rare type of mortgage. Check with you local lender to see if they are willing to participate. a SAM allows you to have a lower interest rate on your loan and payments, but once you sell your house, the bank splits the profit you make off your house, thus the appreciation is shared between you and the bank. This is a rare loan, because not all houses qualify for a SAM. This loan is mostly for NEW houses, because it allows for appropriate appreciation. If your house is too old, it may not appreciate in value if costly repairs are needed in the end.  Also, not all neighborhoods appreciate due to a number of variables such as high crime or an unattractive area.

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