Shared Appreciation Mortgage
With this type of mortgage the property owner borrows money from the bank and gives over a proportion of the future increase in value of the property rather than repaying interest.
The sum you borrow is based on the value of your property and you make no repayments until you die or the property is sold. Upon death or sale of the property the original loan value is paid back plus an agreed percentage of the amount by which the property has increased in value.
Shared appreciation mortgages have had some bad press, as they are a gamble.
For example here is an article from The Scotsman:
The
appreciation society forgets its elderly members
Published: Sun 9 Oct 2005 (scotlandonsunday.scotsman.com)
I'VE never much liked shared appreciation mortgages. They seemed to me
to have trouble written all over them....