| presented by the home income builder
Little Known Secret: Eliminate your Mortgage in 23 years or less!
by: Tom Levine Wanna know a little secret? There is an ingenious method you can use, to pay off your 30 year fixed rate loan, in 23 years or less.
It's straightforward, simple, and easy to understand. In this article, we're going to explore this little known secret, and we'll provide several examples of how it works, a few methods on how to implement, along with some information on where to go and how to get started.
1.
Accelerated Payments: By accelerating the payment structure on your loan, the life of the loan is reduced: - In a normal 30 year fixed rate loan situation, your monthly payment is applied towards principle and interest. It is amortized over the course of 30 years.
- So any money above and beyond your normal payment is applied solely towards the principle of the loan.
- By reducing the principle of the loan, you are reducing the total amount of interest that must be paid, and that equates to an early loan payoff.
2.
An Illustration: 3.
Methods: Think of it this way: All you have to do is make 1 extra monthly house payment a year.
Do that and you reduce the life of your fixed rate loan by about 7 years! You can be as creative as you want to accomplish this, but here are 3 known methods: - Bi-Weekly Payments: Normally, you make your house payment once a month, or 12 times a year. But with a Bi-Weekly payment structure, you take your normal house payment, and divide it by two.
This is the amount paid every two weeks, instead of once a month.
By doing this, you basically make 1 extra (monthly) payment a year. - Double Payments: Double Payments simply means an extra house payment.
Once a year, you write out a check for twice the amount. So, if your house payment is normally $1,000 a month, then on December 1st, for example, you'd write out a check for $2,000.
This, in essence, accomplishes the same thing that Bi-Weekly Payments accomplish.
You make 1 extra payment a year. - 1/12 increase in payment: Increase your monthly mortgage payment by 1/12, and you accomplish the same thing.
Let's say your house payment is normally $1000.
1/12 of your house payment is $83. So, you start making payments for $1,083. Guess what?
Your loan is paid off in about 23 years instead of 30.
Sidenote: A "Bi-Monthly" payment is not necessarily the same thing as a Bi-Weekly payment.
It may just mean that you are paying your monthly payment on the 15th and is paid on the 30th.
The key is this: Are you paying a little more each year, such as 1 extra house payment? If you are, then early payoff is your ripe reward! 4.
Here's an Example: Bob has a $300,000 loan at 7% interest, and his monthly mortgage payment is currently $1995.91.
Each year, Bob pays $23,950.92. - Bob calls his lender, and his payment schedule is restructured as a bi-weekly payment. Every two weeks, Bob writes a check out for $997.
96.
Because of the two extra payments this year, Bob will have paid $25,946.83. His loan is reduced by about 7 years.
- Or, on December 1st, Bob writes out a check for $3,991.82. Because of this 1 extra payment, Bob will have paid $25,946.83.
His loan is reduced by about 7 years. - Or, Bob pulls out his calculator, and adds 1/12 to his monthly payments, which equates to $166.33. Bob now writes out a check each month for $2,162.
24. At the end of the year, Bob will have paid $25,946.83, and his loan is reduced by about 7 years.
5.
The Next Step: We've enjoyed providing this information to you, and we wish you the best of luck in your pursuits.
Remember to always seek out good advice from those you trust, and never turn your back on your own common sense.
Copyright 2004, by LoanResources.Net Publisher's Directions: This article may be freely distributed so long as the copyright, author's information, disclaimer, and an active link (where possible) are included.
Disclaimer: Statements and opinions expressed in the articles, reviews and other materials herein are those of the authors. While every care has been taken in the compilation of this information and every attempt made to present up-to-date and accurate information, we cannot guarantee that inaccuracies will not occur.
The author will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.
About The Author
Tom Levine provides a solid, common sense approach to solving problems and answering questions relating to consumer loan products. His website seeks to provide free online resources for the consumer, including rate-watch, tips and articles, financial communication, news, and links to products and services. You can check out Tom's website here: http://loanresources.net, or you can email Tom at info@loanresources.
net .
|
.
|
Create
an Economic Recovery Fund (like the
International Monetary Fund) to Purchase,
Guarantee and Trade the Toxic Mortgages
on the Financial Institution Balance
Sheet , 
Your Ticket to online Income
Recovery from Home.
The
Ultimate Grass Root Bail Out.
Financial Success
is our
#1
Priority
Located on these
(see
below) 106
Domains, selling
FullTime to
500 Million
Buyers with
Multiple Income
Streams
(see below in module
4)
delivering Sales
and Income from
each of the
106 Portals
all
across the Internet
Generating Sales
and Income For
You 24/7, 365
days a Year.
This
Home Income portal implements the most powerful methods for making profits online, and
it is the only online business I have to earn a living.
The
Worst Day of my Life is Retirement, nothing to do,
a worthless watch and a lifetime wasted, cleaning
everybodys garbage. I am a sanitary engineer, worked
all my life, brought up 5 children, and have 3 Grandchildren.
Then I eat Dog Food to make ends meet. Some Mornings
I do not want to wake up. My old company cannot
even remember what I look like after 40 years of
labour there. 
