Early Mortgage Payoff Strategies: Discover How You Can Slash Your Mortgage...

Can you remember when you moved into your first home? How did that feel?

What better investment in your family than home ownership.

But as you earn your paycheck each month, you quickly realize that sometimes approximately 40% of your monthly hard earned paycheck goes towards paying off your mortgage and it feels worse as most of that is just for the mortgage interest payments.

Thats perfectly acceptable but...

Most of your payments go towards paying off mortgage interest rather than paying off principal.

If you decide to refinance or move to another home your 30 year mortgage automatically now becomes a 40 year mortgage. For most of us it could take up to four decades to pay off the mortgage.

And lets assume you are approaching retirement.

Just imagine your mortgage outlasting you in retirement. When you pass on the home on to your kids they think they have a home but may be saddled with mortgage debt as well.

You may think you are donating the home but the sad reality is that you are donating over mortgage debt.

You have worked hard your entire life and been conservative and responsible with your money.

Living debt free is the ultimate retirement dream. Is there a way to do this without changing your lifestyle or spending more of your cash?

There is a smart way out. And I will reveal this to you in this article.

Lets assume that your largest debt and your largest bill is...

Your mortgage.

No longer do you have to pay all the interest that will be accrued on a long term mortgage.

Using the method of mortgage acceleration, you could save thousands in interest and pay off your mortgage at least 13 earlier, without spending more or refinancing.

A leading financial magazine has conducted a survey on debt. It shows that almost 83% of American homeowners are in debt with the mortgage their biggest debt.

Less than 5% of Americans are able to actually retire financially independent.

And the best way to become financially bullet-proof is to retire without any debt.

Mortgage Acceleration is the quickest way to eliminate mortgage debt without you changing your lifestyle.

Mortgage acceleration is a term used to accelerate the pay down off your mortgage faster than that is shown in your mortgage amortization schedule.

By making additional payments towards your mortgage in the early years, you could pay off principal at a rapid pace and end up paying off your mortgage earlier.

You may not have extra payments each month as you may want to invest this or use this for personal spending. By applying the mortgage acceleration system it is a smart way of making more of your payments to principal and ends up paying your mortgage faster, all without paying more.

It takes your monthly payment and automatically applies more of this to principal rather than interest.

Your mortgage could be halved and you could end up with thousands of your own money back in your own hands.

This is the biggest benefit of the mortgage acceleration system.

By living debt free in retirement you have the option to travel and set the way for your kids to follow your good financial habits. They never have to work just to pay off debt.

Here is where I would start:

Have you seriously thought about the amount of interest you pay on an average mortgage?

Heres why you should be asking that first question.

As soon as you have done the calculation you will find that your mortgage amortization schedule works against you. It is set up in favor of the banks, where they end up collecting interest upfront. This is considered acceptable lending practice by your mortgage company and once you see this, you will soon find out why you end up working for the bank your entire life.

By taking a look at various examples of how the early mortgage payoff accelerator program benefits you, it will give you a clear picture and understanding of how the early mortgage payoff accelerator program works and an idea of how to apply the early mortgage payoff accelerator program to your mortgage.

Lets Assume You Are In Your 20s and Have 30 Years To Retirement:

Lets assume you have a 30 year fixed rate mortgage. The value of your mortgage is $300,000. If your interest rate is 6%, you will end up spending at least $347,514 over the entire life of your mortgage in interest payments alone.

Isnt it interesting you have to pay back more than you initially qualified for on your mortgage.

By using the early mortgage payoff accelerator, this same mortgage can be paid off in half the time saving you $60,000 in interest.

Now, you can completely eliminate your mortgage before you reach 40.

You can now apply for a second mortgage, and buy a home which you can rent out and earn a steady stream of income each month.

You may even consider retiring from your corporate job at that point.

Think about the quality of life by being debt free.

Heres the best part. You dont even have to change your existing standard of living at all.

Let Us Assume You are In Your Early 40s

The biggest goal at this point would be to send your kids to college. Most of my clients dream of giving their kids a debt free college experience.

Imagine your kids stuck in a corporate job spending 10 -15 years of their life paying off college debts. That financial legacy will continue to perpetuate itself to their kids and so on.

Using the equity acceleration system you can finance their education using the equity in your home.

Imagine the gift of a debt free college experience at graduation.

Since you used the equity to pay for your kids college education you now have to pay this back before retirement. Wait, you can still use the mortgage acceleration system to fully pay off these college costs before retirement. And yes, you can still do that without changing your lifestyle.

And lets assume there is a medical emergency. Building equity in your home allows you to use this as an emergency fund for your family.

Lets Assume That Retirement Is Rapidly Closing In

If you are already close to or at retirement age, the silent threat to your retirement is making a mortgage payment while you are in retirement. Imagine using your retirement funds to pay for debt.

If you had all your funds invested in the stock market last year, you would see that your retirement nest egg slashed by almost half.

And if your nest egg is worth less than a year ago and you are drawing less funds in retirement, and still have a mortgage to pay, you may then have to take on a second job and worse, sell your existing place and move to a more affordable home.

And you can not completely rely on social security. You may need to cut back spending time with the family and figure out ways to supplement your retirement income.

You may be in a position where you dont have to worry about making the debt payments. But imagine what you could do if you did not have the debt going into retirement. You could change someones life and help out your family.

You can accomplish your individual goals as fast as you like with a mortgage acceleration program. You are not are not restricted as to how long or quick you can eliminate your mortgage debt.

What is Required For The Early Mortgage Payoff Strategy In Order To Get Started?

Your home must be in your name and you are the owner

Ability to qualify for a Home Equity Line of Credit (HELOC)

You have to have a more income to debt or dont spend more than you earn each month.

A early mortgage payoff accelerator program consist of a line of credit (HELOC) tied to an account with direct deposit that works like a checking account to pay out regular living expenses as well as pay down the balance of the house cost.

The HELOC allows you to reduce the outstanding balance on your mortgage faster by applying more of your monthly repayments to mortgage principal than interest. And in the event you have some cash available you can also accelerate the pay down of your mortgage at a much faster rate.

Is The Early Mortgage Payoff Strategies Only For A Fixed Rate Mortgage?

A mortgage acceleration program can work for most types of mortgages for example ARM and an interest only mortgage.

And if you have an adjustable rate mortgage (ARM) the benefits are amazing. What you dont realize when you take out an ARM is that you mortgage term is longer than 30 years. So a 5 year ARM will take you 35 years to pay off. Why? Because once the adjustment period expires, the mortgage resets and you begin with a whole new 30 year mortgage all over again. And with a early mortgage payoff accelerator you could end up paying off your mortgage in 20 years or less rather than the 35 years you are scheduled to pay off your mortgage.

And the benefits are the same for an interest only mortgage. Imagine the ability to pay off an interest only loan in under 30 years.

And if you run out of money in retirement, you could end up taking out a reverse mortgage to finance your retirement. But here is the catch to qualify for a reverse mortgage. You need to have equity in your home. A early mortgage payoff accelerator program gives you the advantage to build equity so you have the option of taking out a reverse mortgage in the event you ever need the extra finances.

Financial planning and check writing features are now being incorporated into many early mortgage payoff accelerator loan programs thus eliminating the need for a separate cost of a financial advisor. As you now have more insight on the benefits of a early mortgage payoff accelerator program, the key is to get started immediately.

How Do You Get Started With A Early Mortgage Payoff Strategy?

STEP 1: Starting Point

The first thing is to create a quick financial plan based on your unique numbers. This may very well be the biggest obstacle in applying a early mortgage payoff accelerator to your mortgage. You may think it will take forever to develop a plan but it won't. You can keep it simple, yet accurate. A early mortgage payoff accelerator plan usually takes into account your income, bills and mortgage and comes up with the ideal way to pay off your mortgage in 10 years.

A early mortgage payoff accelerator plan is a great tool to make sure that you never fail to eliminate your mortgage no matter the situation. If life happens and you get off target a good mortgage acceleration plan can automatically help you get on track again.

STEP 2: Decide On The End Goal " When You Want to Be Mortgage Free"

The best way to eliminate your mortgage is to first set a date you want your mortgage fully paid off. Once you have this in mind, enter your information in a early mortgage payoff accelerator calculator and a mortgage acceleration plan will automatically be calculated for you. In this way you can decide whether the plan meets your goals or you want to use other means to accelerate the payoff of your mortgage.

One way to accelerate the pay off of your mortgage is to use the mortgage acceleration system. Other methods are also available but require you to pay extra towards your mortgage to have this fully paid off.

Different Ways To Pay Off Your Mortgage

1. Biweekly Mortgage Payoff System

A bi-weekly program is a common way to pay off your mortgage faster. With this unique program you make 26 bi-weekly payments a year. This results in you making one extra mortgage payment each year.

NOTE: Sometimes a mortgage holder or private lien holder will not accept partial payments. Instead, put your half payments in a separate account. Make your monthly payment as usual out of this account. Then, either every 6 months, when you have the half payment available, send it to your mortgage company or wait until the end of the year when you will have a full payment to send in. Keep in mind, with a bi-weekly mortgage program instead of having interest reduced on a daily basis, unlike the early mortgage payoff accelerator system; you will be making 1 extra payment a year.

Contribute More To Mortgage Principal Each Month

The second method of paying off your mortgage is to pay extra to rapidly reduce your mortgage principal. One way to do this is to have a budget in place to save extra money each month to spend towards your mortgage. Other ways typically include using overtime funds, bonus or your paycheck from a second job.

Types of Mortgage Acceleration Programs

The choices of early mortgage payoff accelerator programs can sometimes be very confusing. The may be described in various names such as accelerator, acceleration, equity, equity genie, mma, and other similar names.

One common trend across various mortgage acceleration programs is the use of software to help you navigate your finances and help with the goal of an early mortgage payoff. The starting point of these programs is for you to enter your information and the software takes care of the rest. The software is one part of the overall mortgage acceleration process. The key of any mortgage acceleration system lies in the set-up. If you set up the program for your situation ineffectively, you may not achieve the goal of slashing your mortgage early. The software is only as good as the initial set-up.

If you plan on selecting the appropriate mortgage acceleration system that has the right software, there are usually two types of software. The first type is where you have to enter detailed information each month and it calculates your information and keeps you on track. You are the slave to the software system. The second type of software is where you only enter one piece of information and it automatically does all the work for you. You are the master and it takes you less than 30 seconds each month. The less data entry, the easier it is to manage the program.

Does This Sound Too Good To Be True

If you ever had that though then that is a valid concern. You see this method has been used extensively in Australia and New Zealand. Since it is now in the U.S most banks have been reluctant to show this method to their clients with good reason. They are bound to make less money if you pay off your mortgage early.

The best way to validate whether this may work for your situation or not, is to enter your numbers in a early mortgage payoff accelerator calculator. Take a moment, use the early mortgage payoff accelerator calculator that can be found on line, input your particular information, and you will see how this will benefit you in the long run. By saving on your interest payments and applying more money to the principal, you will be affectively accelerating your mortgage.

For example, let's use the same example as above but this time you have a $200,000, 30 year mortgage, with a 6% interest rate. If you can afford the fee of $397 to set up the early mortgage payoff accelerator program you can save over $64,000 in interest. You can get over a 460% return on your investment. Ask your financial advisor to run the numbers and you can judge for yourself whether this works or not. Who wouldn't like to accumulate money at this fast pace? And, you are not changing your current lifestyle, but are helping your kids or grandkids go to college and imagine what you can do with the additional savings.

Lets Take A look at The Following Situation In More Detail

Assume you plan to move in the first 5 years. As you know than in the first years, your mortgage company charges you almost five times more in mortgage principal rather than interest. So if you decide to move in 5 years or refinance very little progress is made toward your mortgage balance.

Lets assume you had a $200,000 mortgage. At the end of the first 5 years, you would pay close to $58,054 in interest payment, and $13,892 towards mortgage principal. Almost 5 times more in interest payments than principal. Now lets say you refinance, your adjustable rate mortgage is due or you decide to move to a new home. What happens?

And now that you refinance or move the entire process repeats itself again. So a 30 year mortgage now becomes 35 years because after the first 5 years you start all over again. In 10 years you end up spending $166,000 in interest and $28,000 in mortgage principal. Almost no progress is made and now you are really working for your bank spending all your hard earned money on interest.

Its time to take back control with the mortgage acceleration system

The banks expect you to pay mortgage interest and stack high interest payments upfront. One way to reverse this situation is to use the mortgage acceleration system. Enter your numbers directly in a calculator and see for yourself how you can pay the least amount of interest and slash your mortgage even though you plan to move or refinance.

What About The Home Equity Line of Credit (HELOC)

One of the key steps behind the early mortgage payoff accelerator program is that you need to have a HELOC to make this system work. A HELOC now replaces your existing checking account and is used as a means to pay off your mortgage early. When using the HELOC you are not borrowing any more money to pay off your mortgage. You are just using this as a means to deposit your funds, withdraw your bills and pay off your mortgage early.

Lets examine some of the advantages of using a HELOC

1A specific limit (which is usually the equity amount) enables you to borrow money only as it is needed. This is similar to a second mortgage

A line of credit may last for 10 to 15 years

Certain HELOC have no closing costs and transaction fees associated with using these accounts

Where your bills payments are lower than the salary you deposit into the HELOC no interest is paid on your HELOC

HELOCs generally allow you to have a larger borrowing limits and lower cost of interest

Mortgage and HELOC interest paid money is tax deductible, in contrast to the traditional taxable savings account. Let's say you are in a 25% tax bracket and have a HELOC which is tied to prime + 1 (=6%), the interest you pay is 4.5%. But, if you are earning 4%, you will get a 1.5% return on your HELOC. This is where using the early mortgage payoff accelerator calculator will be beneficial to your situation. Please check your state to see if a HELOC is accepted there. Texas does not recognize HELOC

A HELOC can also be used as an emergency fund. This is where you can reserve your extra cash for day to day spending or for emergencies, as state briefly above

What You Must Know About The early mortgage payoff accelerator Program

1.Your HELOC limit could get frozen

Due to the credit problem in the market banks may automatically value your home and freeze your HELOC limit. This is automatically done by the banks computer system. If your HELOC is automatically frozen you get an appraiser to revalue your home and ask for a second valuation. In this way you can get your HELOC unfrozen. As an alternative you could use a credit card to pay off your mortgage faster.

2.Your mortgage broker may tell you, you have to refinance your mortgage

Your bank my encourage you to borrow more on your line of credit in order to get a lower rate. You generally dont need to borrow more money. Only use exactly whats required by your plan. In his way you are sure to pay off your mortgage early.

Other Ways You Can Use Mortgage Acceleration To Pay off Debt other than Your Mortgage

Here are some ways you can use the mortgage acceleration program in addition to slashing your mortgage earlier

1. Pay Off Automobile Loans

A car payment can be easily eliminated with a early mortgage payoff accelerator. You can use the method of the HELOC to rapidly payoff your car payments without spending more or changing your payments. In this way your car can be paid off early and imagine having the ability to have the extra cash flow which you could now use to accelerate the pay down of your home.

Credit Card Loans

To eliminate your credit card, the best way is to borrow against your HELOC and pay off your high credit card balances. The mortgage acceleration system can help you to rapidly pay down the HELOC and completely eliminate the credit card debt.

As you can see, the possibilities could be endless with the early mortgage payoff accelerator. Once you begin to visualize the various ways in which you can apply this to your situation, you will begin to understand the true power of this system. Just a few ideas and suggestions have been listed here for your review and benefit. Once you decide to reorganize your mindset around the early mortgage payoff accelerator, every extra $1 added to your HELOC is applied to accelerating your mortgage debt.

When you plan to retire is entirely up to you. There are no rules that you must retire only at 65. Retirement at any age is only the beginning of the next phase of your life and you are never too young to start planning for your retirement now. The earlier you start the early mortgage payoff accelerator program, the more positive cash flow you will have in later years. And this is critical step in securing a retiring early. By taking this step toward financial freedom and applying a early mortgage payoff accelerator program in different aspect of your daily living, you could also be teaching your children the value of preparing for their retirement. Who better to teach them than their father, mother, grandfather or grandmother, or any family member that they look up to so that they never have to struggle financially with debt in their entire lives. Maybe, just maybe, you can be responsible for a new era of sound financial planning by applying the principles listed here, that will make for a more stable lifestyle for your children. And they wont have to experience what recession is or wonder if their jobs are stable.