The financing module defines a Growing Equity Mortgage (GEM) as a fixed-rate loan with scheduled payment increases applied directly to principal, accelerating amortization and reducing total interest over the life of the loan. This differs from negative amortization (where payments don’t cover interest and the balance grows), blanket mortgages (cover multiple parcels with a release clause), and pledged account mortgages (use a pledged savings account to subsidize payments).
[References: Maryland 60-Hour Principles and Practices of Real Estate — Financing: mortgage types and characteristics; GEM structure, payment increases, and accelerated amortization.]
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