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By Marty Meshek
Are you serious about saving thousands of dollars in interest money? Did you get a good deal with your mortgage? Most people choose a mortgage based on one thing: The interest rate. They may take all of 30 minutes deciding on a mortgage and then lock themselves into 360 months of payments. 30 years of hard labor!
In the past when I have taken out a loan I always stop to multiply the payments by the term, or the number of months. When I was told I was approved for a 6% loan on $200,000 for my home I stopped to figure out what it really was going to cost. I multiplied my payment of $1199.10 by 360 months and came up with $431,676! Now, that seemed like a lot more than 6% to me. That was $231,676 in interest alone!
I did some investigating and found that most buyers are tricked into thinking that 6% or 6.25% is a good rate. Well, let’s look at that 6% APR loan. The truth is that loan is front heavy on interest. Check it out for yourself. Call your lender and ask how much of your mortgage payment was applied to the principal and how much was interest. Of my $1199.10 payment, $1000 went to interest and $199.10 went to principal. I figured it out. That equates to 502% interest that first month. I could not believe it. I knew it would get better. It had to! I asked my lender to break down the figures for me. By year 15 I was still paying $1199.10. I was amazed to find out that $713 went to interest and only $486 to principal. I was still paying 146% interest.
I found out that 6% meant 6% APR or annual percentage rate. 6% per year over thirty years was actually 180%. Why didn’t my banker tell me this?
This, I thought was trouble, because I knew by year seven or eight I would want to move to another home, just as most Americans do. I knew that my equity was built by adding to the principal and not the interest. After one year of paying $1200 each month I would only have $2400 in equity from those payments.
That $231,000 in interest actually was 115% interest. Not 6%! Call your banker and get the numbers for your own loan. You will be amazed! Of course this lead me into some checking around for something better.
What I found was a system of paying down mortgages in 12 to 14 years. This system has in fact been in use for many years in England and Australia! It is not making two payment each month or even send a few hundred dollars each month. It is the combination of powerful, easy to use software with a simple secondary account. Even though I knew my lender had made thousands of loans and no one was complaining, I was just shocked that my equity was building so slowly. It is like I woke up from a dream! The system in other countries cutting mortgage time in half or in third is tried and true. It is legal and a very simple concept that works with your existing mortgage. There are no risks involved, no roll of the dice and no out of pocket expenses incurred by the home owner!
The vehicle is called a Money Merge Account, a powerful financial tool and software to help you fulfill your dream of home ownership and save money for your future. The average Money Merge Account customer will pay their mortgage off 100%, in 1/2 to 1/3 the time, with little to no change to their day-to-day spending habits and without increasing their monthly mortgage payments. It will save the average home owner tens or even hundred of thousands in interest on their home loans.
I now spend my days helping average people build equity much faster and pay off their home loans in less than half the time of the traditional 30 year mortgage.
About the Author: Marty Meshek is an agent with an office in Fort Collins, Colorado. His aim is to help people all ove the country with ‘preventative financial maintenance’ His website is located at:
PayDownPros.com
Source:
isnare.com
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