| Author |
Message |
opendomain
Forums Member
Joined: 19 Aug 2007
Posts: 531
|
#1 · Posted: 30 Aug 2007 20:24
Not sure where to post this, so I figured here was a good a place as any.
A friend of mine from work( i work at home and in an office) came to me today about a program to pay off your home in 10 years without increasing your payment using an heloc line of credit he showed me a system of sorts online and I was wondering if anyone was doing this. He showed me some statements from his mother's mortgage company where she was able to pay out practically 2 extra mortgage payments in one month. Does anyone know of anything like this? Or has anyone seen anything like this?
I Have a site but don't want to post it for fear of "advertising" in a post so i'll just update my signature. Let me know if anyone has seen this before?
|
opendomain
Forums Member
Joined: 19 Aug 2007
Posts: 531
|
#2 · Posted: 11 Sep 2007 19:26
So after some research and number crunching of my own I think i've been able to verify the validity of this program...due large in part it being simple math. It is indeed very possible to save 100's of 1000's of dollars using this program. It wasn't that hard to work out in spreadsheet with some fancy formulas and table lookups...technical side withstanding anyone could do this.
The basic premise is that you take out a line of credit using the equity in your house. Using this line of credit you can make extra payments on your mortgage principle in massive amounts. I ran my best friends numbers through my spreadsheet and was able to allow him to pay off his car this month and then for the next 14 years make an extra payment to his principle balance of 3500 every 4-5 months leading to him paying off his $210,698 in 14.5 years while saving $132,456 in interest.
Now that I know this can work I have a questions.
Has anyone ever seen or heard of this, I am in the accounting field and know the numbers work, however as far as realty i'm not to educated. Does anyone see where this might pose a problem?
|
jnapier
Forums Member
Joined: 30 Aug 2005
Posts: 647
|
#3 · Posted: 25 Sep 2007 14:42
There are programs like this but they amount to a software program that teaches you to be more diligent about your personal finances, which if you'll simply budget and pay attention..you can pay off your loan quicker without the Heloc software, which can run upto $3500 by the predomanant mlm company selling it.
Jay NaPier
__________________
|
rhondap
Forums Member
Joined: 13 Jun 2007
Posts: 284
|
#4 · Posted: 25 Sep 2007 16:20
Just sby sending in an extra payment or two or three  and/or applying more to the principle each month can accomplish the same thing for free. 
You just need to specify where you want the extra money to go to.
__________________
|
getagrip
Joined: 20 Feb 2006
Posts: 2087
|
#5 · Posted: 27 Sep 2007 16:39
If you don't raise your payment, I don't see how you can pay a 30 year loan off in 10 years unless you can get a lower interest rate.
__________________
|
emmjay
Forums Member
Joined: 19 Sep 2007
Posts: 125
|
#6 · Posted: 5 Nov 2007 19:01
If you just switch your payment schedule from monthly to biweekly this alone will knock 6 years off your mortgage.No need to purchase any software.
|
opendomain
Forums Member
Joined: 19 Aug 2007
Posts: 531
|
#7 · Posted: 5 Nov 2007 19:33
Ah but there is a way. I'll even tell you the secret because I've cracked it with several friends of mine...jk it's not really a secret and the program actually optimizes a basic principle.
If you haven't seen the program visit my main page then click equity builder and then the giant stop sign to get a much more detailed breakdown.
here is how it works, without having to pay anything out of pocket or switch payments to bi-weekly, or send extra payments in which in the end take money out of your pocket.
There are a few conditions. You need to be making more money than you spend(discretionary income) and you need to have equity in your home.
You are basically taking out a HELOC(Home equity Line of Credit).
Through this HELOC you are going to run all your expenses out of it(rent, utlilities, food, car payment etc, etc), you also have oyur checks directly sent to your HELOC(which interest only)
Example.
You have a HELOC of 10k. Your monthly income is 2k your monthly expenses are 1500. The first month you send a 3k payment to your bank for mortgage. Then the following month you make 2k, spend 1.5 leaving the new balance of the HELOC at 2500, The next month you do the same, decreasing the balance to 2k, then 1.5k, then 1k, then you send another 3k payment to you mortgage company, then wash rinse repeat. The benefit is that you aren't using your out of pocket cash. For instance lets say you didn't do this and sent an "Extra Payment" then your car breaks down. Go to your bank and see if they will send you back your payment...good luck. IWth a HELOC though you will have the line of credit available to you.
I do a horrible job of explaining it but that is the SIMPLE math behind it. Watch the video, call my friend his name is on the site, I help spread the word about it simply because he's a friend of mine and I do see the possibilities.
Good Luck.
|
Newbie Shield
Joined: 22 Sep 2007
Posts: 2226
|
#8 · Posted: 5 Nov 2007 21:02 · Edited by: Newbie Shield
It's as simple as making one over-payment or an extra payment per month. Furthermore it helps if you explain that you want x amount to be credited to the principal.
Nothing more to it though I am sure that your site provides some useful guidelines.
Newbie Shield
|
opendomain
Forums Member
Joined: 19 Aug 2007
Posts: 531
|
#9 · Posted: 6 Nov 2007 10:12
Quoting: Newbie Shield It's as simple as making one over-payment or an extra payment per month. Furthermore it helps if you explain that you want x amount to be credited to the principal.
Until my GDI goal is met and exceeded this coming year i'll not have the means to make an extra mortgage payment...nor do I want to be out of pocket the 1500...that's money for taking the wife and family out and buying gifts, and medical expenses, etc, etc, etc (I have 4 children mind you)
Quoting: getagrip If you don't raise your payment, I don't see how you can pay a 30 year loan off in 10 years unless you can get a lower interest rate.
You DO increase your payments, but you DO NOT use your own money in hand.
It's a little more than an extra payment a month. The main difference is that with an extra payment a month you are paying that out of pocket. That's money that will not be in hand. Using a HELOC to pay it off is like using your own money, but that you still have access too.
If anyone is interested I have created two spreadsheets that do what the software does...only not optimized and not automatic, essentially that's what the software is for, to automate things and optimize your savings. The nearest i've coming to meeting the software was 20k away. The software lets you know when to send payments in to better optimize your payments.
Quoting: jnapier There are programs like this but they amount to a software program that teaches you to be more diligent about your personal finances, which if you'll simply budget and pay attention..you can pay off your loan quicker without the Heloc software, which can run upto $3500 by the predomanant mlm company selling it.
What the software is not:
1. A "financial planner", it doesn't show you how to better manage your bills.
Of course there is a company behind it, there is a company behind everything, yes it is MLM, however you don't make any money from signing anyone up, oyu only earn a small portion of what your downline makes...and that is ONLY if you have done your share, if you go 3 months without "making a sale" you are no longer offered the opportunity to offer this opportunity.
You can absolutely do this stuff without use of this program, hence the two spreadsheets i've created, however I can tell you know, optimization alone will save you around 15-30k in the long haul, not to mention not having to worry about "fine tuning" and being diligent about knowing when the best time to send payments off is.
This is the only program i've seen that will let you pay your mortgage off with out 1, increasing your monthly out of pocket cost & 2, allow you the option of paying off your car and pretty much any other loan you have.
This system works best when you have a larger expendable income, so the quicker you get rid of your 200+ car payment the sooner you can use that 200 to put back into your house.
My friend has his mother set up on this and she has so far sent 3 extra payments of 3k each in the last 3 months, without her having to put the money up upfront. Again because you are using a LOC it's not coming out of your pocket, and because you are using your expendable income to decrease the amount owed, while still having access to your expendable income you are winning.
|
asebf
Forums Member
Joined: 11 Sep 2007
Posts: 267
|
#10 · Posted: 6 Nov 2007 10:37
Open,
I have been in the mortgage business for over a decade and prior to that was in financial planning for a couple of decades.
What you have discovered is real. And you are right - there is no magic. This program just makes it easy for someone without your CPA skills to accomplish what you have done on your own.
Is it worth the price of admission? Not for someone with your learned skills - but for most of the general public, if they get into this and actually apply it - the answer is YES.
Note: I do not market this program - but I do see the validity of it.
__________________
Bob
|
opendomain
Forums Member
Joined: 19 Aug 2007
Posts: 531
|
#11 · Posted: 6 Nov 2007 12:53
Thank you asebf. Again I am just doing this for a friend who's trying to start out a business. I see where this is a very beneficial "tool" that someone could use to help pay off.
Like I said I can create a spreadsheet that does the same thing, only nowhere near as optimized and without the ability to easily adjust for accidents, acts of God, and unforseen expenses. Plus It would be something I'd have to sit at and do every month...I just don't have the time for that.
Again If anyone has any questions I can either give you my friend's number or you can contact him directly through his site...which is linkable thorugh my home page under Equity Builder.
See you in other posts
|
shuey03
Forums Member
Joined: 31 Oct 2007
Posts: 52
|
#12 · Posted: 6 Nov 2007 16:03
I don't know if any of you have ever heard of mortgage planning before, but it is hot out here in Utah. I got my mortgage license last year and learned all about mortgage planning and how it can help people invest the equity in their home, use the interest paid to make their mortgage payment each month and after 5-10 years you pull your money out, pay off your home and invest any that is left over. One of my websites [Link removed - Admin] better explains the process. If you are interested, now would be the time since rates are at yearly lows! if you have any questions please let me know.
__________________
Advocate of free offers, sweepstakes, and survey sites! Visit Survey Inferno for a complete listing of Free Paid Surveys!!! |
