3 Steps You Must Take If You Want To Pay Off Your Mortgage In 7 Years Or Less

3 Steps You Must Take If You Want To Pay Off Your Mortgage In 7 Years Or Less

One of the single largest financial purchases a person makes in a lifetime is a home. And more often than not, a home mortgage is required to fund the purchase. But how many people have been told, that the current way a mortgage is paid off, is like a disease to our financial health? The mortgage and banking industry has offered to the unsuspecting public the 30-year fixed amortized mortgage the most expensive mortgage, a financial disease akin to the cigarette industry offering cigarettes.

U.S. consumers have had no other choices, but to use a mortgage, that only benefits banks and mortgage companies. Now a revolutionary mortgage program is available that will show them how to pay off their home mortgage in as little as 7 years.

Enter Money Principal Group, a company located in Utah, founded by Ariel Metekingi, a native of New Zealand. Their premier innovative mortgage product, The Mortgage Eliminator, is based on a 30 year+ proven Australian industry standard and model in use by over a third of homeowners in that country. It was later introduced to the New Zealand market, where homeowners there achieve similar results; paying off their debts and mortgage on average of 6-10 years.

This powerful new tool to combat the current financial plague of debt combines a mortgage and a full-service bank account. The new "all-inclusive" type loan creates huge savings in interest payments and loan payoffs in one-half to one-third the time requiring little to no change to current spending habits or income.

How does it work? Homeowners deposit income and other assets into the new mortgage account and since it allows access like a checking account, expenses are paid out from it by check or ATM card. The fundamental part is, that when the homeowners' money isn't being used it sits in the mortgage account, reducing the daily loan balance on which interest is computed. This saves on average hundreds of thousands in interest over the life a typical loan and reducing interest means more money for principle; so the homeowner builds equity faster and owns their home sooner.

"What this does for homeowners, is it empowers them to take control of their financial health," says Ariel Metekingi, founder and president of Money Principal Group. "With this new loan program, a homeowner can combat the financial disease known as consumer debt plus current mortgage options and it allows the homeowner to reach their goals sooner in life, rather than later. This isn't a mystical trick of numbers; it is simply taking away the interest spread banks earn and is given back to the homeowner."

There are three steps that the consumer can take, in order to reduce their mortgage payout and enjoy a home paid off in as little as 7 years.

1. Decide What Your Goals Are

One of the first steps with The Mortgage Eliminator program is to have a clearer picture of where you are heading financially-speaking and decide on what kind of goals you'd like to reach. First, take a look at where you were five years ago. What kind of expectations did you have then? Did you plan on certain things to happen by now? If they didn't happen, do you have the willingness to make changes to reach those goals?

Goal setting is important because it allows you to create a flexible plan and schedule to put into place and stick to. Imagine where you'd like to be in 5 years. What would you like to accomplish?

Let's say some of your goals are to have an emergency fund of at least one year of your current income and you'd like to reach that amount in, say, 2 years. And another goal, (if you have a child or children) is to set aside a college fund. And lastly, you've been dreaming of that sports car you've always wanted since you were a teenager.

Now that you have some goals in mind, what would it take to reach those goals? And keep in mind that your household income will probably remain constant.

Are there current investment options or debt elimination options, which can help you reach those goals?

Using your flexible mortgage account through The Mortgage Eliminator can greatly increase your ability to save interest and money and free up resources to help you reach those goals. And it doesn't have to drastically change your spending habits or current household income. Just determine your budget and where the money you make is spent in your life.

2. Set Up a Budget

The next step in paying off your mortgage quickly is to look at your current spending habits and create a budget. How difficult is this? That depends on your level of commitment and your ability to discipline yourself into reviewing your budget.

One way that helps homeowners is through the included budgeting software and personal coaching and review available with The Mortgage Eliminator, from Money Principal Group. Studies show and human nature reflect this, is that if we have tools AND a personal Coach to help create and maintain a budget, we're far more likely to succeed. Money Principal Group states that over 90% of its' clients achieve success with The Mortgage Eliminator system.

Think of having a coach for your personal financial education, just like a great tennis star has a coach or golf professional has a coach. How many of us rely on a coach to become financially wealthy?

With The Mortgage Eliminator, you're given that important part, a coach to review, create and stick to a budget that creates positive cash flow, which will take you to the next steps of paying off your mortgage in less time, without any change to your current income or spending habits.

3. Get a Financial Review and Analysis

Everyone's financial situation is different and completely unique. Imagine your situation as the human body and financial debt (including a mortgage) as a disease. Before a doctor would operate on a patient, a complete review of the symptoms and where to start investigating is done BEFORE the doctor performs any action.

Think of a financial review and analysis as the same thing as "surgical review" on your situation. What kind of mortgage are you in now? Are you a first-time homebuyer? Are you in an ARM loan and now may need to switch to a fixed-rate loan?

What is your financial "picture" and your current budget? Your income, expenses, current debt, and your short-term and long-term goals factor greatly into the financial review and analysis.

In order to determine just how quickly you can pay off your current debts and mortgage (or how fast you can pay off your first home, if you're a first-timer), a financial "snapshot" or review must be completed. Taking a look at your entire picture of income, debts, and how it relates to your goals, is the crucial step, in determining how best you should start your plan.

What is the strategically best way for you to reach your goals? With a financial review and analysis from Money Principal Group, a plan is created to show you the best options that HELP YOU in reaching those goals quickly. Only a loan that SAVES YOU MONEY is offered and if it doesn't make strategic, financially sound sense for you, it's not offered and a different course of action is suggested.

Is this new loan product and system for everyone? Yes, if you can achieve the simple disciplines of budgeting and currently have positive cash flow or are willing to review your budget to recover funds to create significant positive cash flow. You must be coachable and allow your goals to dictate your plan of action. If you're willing to do that, the payoff is unlimited– getting rid of debt and your home mortgage in 6-10 years is no longer a dream, it's a reality.

"The ability to be mortgage free within 6-10 years, quickly eliminate consumer debt and free up existing income to start a significant investment program for the future is now a reality. This can all be possible without requiring any additional income or reducing standards of living. The Mortgage Eliminator has empowered the individual in New Zealand and Australia to impact positively on their own financial destiny in ways, which traditionally, many could not otherwise achieve." says Metekengki. "It is now available for the US, to achieve the same level of financial success and freedom, already experienced and proven in these international markets."

3 Essential Mortgage Refinance Secrets You’ll Need To Pick The Right Home Loan

3 Essential Mortgage Refinance Secrets You’ll Need To Pick The Right Home Loan

Although lowering your monthly mortgage payment is always appealing, don't let a slightly lower mortgage rate fool you.  If you're not careful when thinking about a mortgage refinance, you could cost yourself more expenses than what you save in monthly payments -- and not even know it. (Even with so-called "no cost" mortgage loans.) Refinancing a home loan has more to it than what appears on the surface. Be sure to consult a mortgage professional before making decisions you can't change.

Mistake #1: Waiting for Lower Interest Rates

Mortgage rates are notoriously unpredictable. No one can speculate mortgage rates with enough accuracy to win every time. If rates are attractive, consider refinancing. If you do it right, and rates go down again later, you can always refinance again. If rates go down substantially before you finalize the loan, you can change mortgage brokers. If rates go up, you'll be glad you locked in that initial rate!

Mistake #2: Not Shopping around enough with Local Mortgage Bankers/Brokers

E-loan, Lending Tree, and other online mortgage shopping sites are great, but be careful! They are national mortgage shopping sites. That might sound nice since you get mortgage lenders from across the nation competing for your business, but any lender other than a mortgage lender familiar with lending in your home-state may not be knowledgeable of local practices, and that could cost you in many ways. It might not only cost you that lower interest rate – depending on your other circumstances, it could also cause you to miss your window of opportunity.

Mistake #3: Not Looking at the Whole Picture

If you have been paying your mortgage for several years, the amount saved every month by refinancing might not be as much as you think. In fact, it usually costs far more than people realize! In other words, if you are 10 years into your mortgage loan, refinancing your mortgage would make you start over on the repayment of that debt. Obviously, it might be great to save some money after refinancing your home loan, but once you refinance a loan you've been paying for 10 years, you'll be paying off that loan for an additional 10 years! That could really hurt you. Sure, it may seem great that you're lowering your $1200 monthly payment by $100, but when you factor in the extra 120 payments of $1100 that you'll have after refinancing, you'll find that your "$100 monthly savings" will actually cost an extra $108,000 over the life of the loan ($1100 times 360 payments over 30 years is $108,000 more than $1200 times 240 months).

Be sure to get a "Good Faith Estimate" and "Truth in Lending Statement" from your mortgage broker before jumping into a new loan that could cost you thousands of dollars (if not hundreds of thousands) over the life of your new loan. Get your mortgage broker to explain not only what your monthly payment will be, but also what your new loan balance will be compared to your old loan, what the new interest is, and how many years you will be adding to your repayment schedule if you do refinance.

We are here to help you to choose perfect Home loan for you. Contact Us Now to get a free consultancy.

1% Mortgage Loans… What’s The Catch?

1% Mortgage Loans… What’s The Catch?

1% Mortgage Loans… What's The Catch?

While there are several different types of 1% mortgage loans, there are really only two major components to winning with a 1% mortgage loan.

The first is to make sure the loan is set up correctly from the beginning.

And the second is to make sure you are using the loan correctly to gain the most benefit.

First, let’s talk about how the loan works.  Then, we’ll get into how to set the loan up correctly so you can reap the financial rewards these mortgage loans have to offer.

To start with, 1% mortgage loans have payment options.  Each month when you get your mortgage statement you will have the option to make a 30-year fixed payment, a 15-year fixed payment, an interest-only payment, and a minimum payment at 1%.

Although you are given several payment options, you should only select the 1% minimum payment. 

Why?

Because if you wanted to make a 30-year fixed, 15-year fixed, or interest-only payment, you would be better off getting that type of loan.  Typically, these payments are higher with a payment option mortgage loan.

If you select the 1% minimum payment your first benefit will be a significant monthly payment reduction.

Your mortgage payment will likely be cut in half.  Of course, this is a pretty attractive first benefit for most homeowners.

To compound the effectiveness of selecting the 1% minimum payment you should save what you save.

For instance, let’s say you refinanced your home with a 1% mortgage loan, paid off all your credit cards, and reduced your monthly payment by $1,000 a month. 

Now, if you save that $1,000 a month for yourself instead of giving it to your creditors, you will have $60,000 in cash at the end of five years - And that’s with a zero percent return.

Here’s the second benefit to selecting the 1% minimum payment option:

Tax savings.

If you make an interest-only payment your mortgage balance will stay the same.  If you make a 1% minimum payment you are actually paying less than interest only.  Therefore, you are creating deferred interest which makes your mortgage balance increase each month.

Before you freak out, keep in mind that deferred interest is mortgage interest and is therefore tax-deductible.

Let’s say your home is going up in value $2,000 a month.  The 1% mortgage loan will allow you to take a small piece of that appreciation, say $500 a month, and turn it into a tax deduction.

So you are taking a small piece of your equity each month and turning it into a tax deduction.  If you did not do this, all of your appreciation would be locked up in equity. 

Equity is terrific and is certainly one of the many benefits to homeownership.  But investing in equity will get you a zero percent return.

No one is going to cut you a check each month for the equity in your home.  As a matter of fact, if you wanted to get the equity out of your home you would have to sell your home or get a loan.  And you better qualify or you will not be able to get a loan.

So why not take a small piece of your equity each month, turn it into a tax deduction, and at the same time save $1,000 a month for your self? You will still have plenty of equity but with a 1% mortgage loan, you will have cash AND equity.

If you do this for any length of time you will come out way further ahead financially than if you did a regular 30-year fixed or an interest-only mortgage loan.

By the way, if the deferred interest is a concern, try making bi-weekly payments.  Making a bi-weekly payment will reduce, and in some cases eliminate the deferred interest all together.  Which means your mortgage balance would not increase.

How to set the loan up correctly:

1)  The 1% payment option on these loans is only available for the first five years.  But you could actually keep one of these loans for 30 or 40 years.  If you select a 40-year loan your monthly payment will be lower but the payment options will not last for five years.  The name of the game is to keep the 1% payment for as long as possible.  So get a 30-year amortization.

2)  The 30-year, 15-year, and interest-only payments are tied to an index.  Select a slower moving index like the MTA (Monthly Treasury Average) instead of a faster moving index like the Libor (London Inter-Bank Offered Rate).

So how can you lose with a 1% mortgage loan?

Answer- depreciation.

If homes in your area are rapidly going down in value, deferred interest could cause you to become upside down in the home.

But if your area is experiencing a 3% to 5% rate of appreciation and you save what you save by making the minimum payment, a 1% mortgage loan can have an incredibly positive impact on your financial future.

For more information about 1% mortgage loans and other mortgage related topics, please visit: http://www.residentiallender.net