Using a Mortgage Accelerator to Pay Off Your Mortgage in 10 Years | Mortgage

By IgorBuces
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With the present economical downturn we are experiencing, we find ourselves to ensure that we make the best use possible of the money we make. In order to do so, many of us need to shift the way we think about our finances and how we can change our financial habits to make optimal use of every dollar we make.

For instances, many of us are ok with getting very little return on our money by having it sit in a checking or saving account with very little return. By doing this, the bank is the one making use of our money and getting richer in the process.

Another typical example is the traditional mortgage. In a typical 30 year home mortgage, it's not until the 20 years and 2 months mark that we make the same amount toward our principal that we do toward the interest.

Since the average American only stays in their home for 5-7 years, they barely make a dent in the principal of their mortgage. In other words, the structure of the mortgage heavily favors banks because almost all of your monthly payments go toward the interest portion.

For over 20 years, homeowners in Australia, the U.K. and Canada have used mortgage accelerator programs to pay off their mortgages in less than 15 years saving an average of $150,000 on their home mortgages. The good news is that this type of programs is now available to homeowners in the U.S.

A mortgage accelerator works without having to make any additional payments toward the mortgage. It works in the following way:

1. At the beginning of the month, a piece of software will tell you the optimal amount to pay to your 1st mortgage to ensure you are paying as little interest as possible. The money for this payment will come from an advance line of credit (HELOC.) This transaction reduces the debt in the 1st mortgage and moves you further down the amortization schedule.

2. You then deposit your monthly income in the HELOC decreasing the balance on the HELOC. When you do this, you have your money working against your debt in the HELOC by saving on the interest you'll be charged.

3. You charge your daily expenses on a credit card to allow your money sit in the HELOC for as long of a time as possible.

4. At the end of the month, you pay off the balance in your credit card with money from the HELOC and therefore avoiding interest charges from your credit card company.

By doing these few changes, you can start making the bank's money work for you for once and no the other way around. Using other people's money (the bank's funds) is the way many millionaires have become financially independent.

Even though it takes some getting us to these changes, you can think about the alternative available to you; After all, how long and how much effort would it take you to earn the money you would be saving if you knew you could pay off your home mortgage in 10 to 15 years?

About the Author

To find out more about how you can apply a mortgage accelerator program to pay off your home in 10 to 15 years and save an average of $150,000 go to our mortgage accelerator website where you can find articles on how a mortgage accelerator works.

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