Mortgages are great! Without a mortgage, the average person could never afford to buy their own home. However, your mortgage is also very expensive, and the real cost of buying your home is much higher than your sales price. Accumulated interest charges over the life of a thirty year mortgage can cause you to pay over three times the price of your house.

$100,000 Home

30 Year Mortgage 

Even worse, after paying your mortgage for 15 years, you will still owe 90% of the amount you borrowed! After paying for 24 years, you will still owe over 50%! Isn’t it funny how we are thankful that the mortgage company will lend us money to buy a home that we will pay 2-3 times for? The good news is that you don’t have to follow their rules!

The truth is that you can save thousands of dollars in interest by paying off your mortgage early! A mortgage acceleration plan does not have to be expensive, either. Did you know that if you are able to make one extra payment per year to the mortgage company you will finish paying for your home seven to fifteen years sooner?!

By accelerating your mortgage, you can save thousands of dollars in interest, pay off your home years earlier, and utilize the savings to create an investment plan! The amount of money you can save is dramatic.

A homeowner that has an 8% mortgage on a $100,000 home will pay a total cost of $264,154 for their home. However, if they pay their house off in twenty years, the total cost will only be $200,746! Instead of making mortgage payments for the remaining ten years, this family could start a monthly investment plan and have over $176,000 by the same time they would have just paid off the house without an acceleration plan!

If you are not accelerating your mortgage, you are paying the bank more than you need to!

There are really two types of mortgage acceleration plans for you to choose from.

The first option is simply to make extra payments to your mortgage company. This can be done one of a three ways.

You could make one extra payment each year. For example, you could designate your tax refund or holiday bonus towards paying down your mortgage. However, many people with good intentions have a difficult time doing this however because there always seems to be something more important to spend the money on when the opportunity arises! If you decide to go this route, keep in mind that the earlier you make your extra payments, the more you will save in interest!

Pay extra each month. This method can certainly be easier to budget. Each month when you pay your mortgage, add an extra principal payment equal to 8½ % of your total mortgage payment. At the end of the year, you will have basically made an extra month’s payment directly against the principal!

Enter into a bi-weekly mortgage payment plan. This method is the easiest to budget for! Instead of making 12 monthly payments, you will make a half payment every two weeks. For example, if you normally paid $1,000 per month, you would instead pay $500 every two weeks. Since you will be paying every two weeks, you will actually make 26 half payments. Making 26 half payments is the same as making 13 full payments, which is the same as making one extra full payment each year! Another strength is that this method is automatic. Bi-weekly programs run on their own once you set them up so you won’t be tempted to spend the money on something else. All you have to do is establish the plan! This method is especially attractive if you are on a bi-weekly payroll schedule with your employer.

The advantages of Option 1 instead of Option 2 are that you can implement Option 1 even if you are older in age or in poor health.

If you have an emergency or opportunity, you cannot recover the extra funds paid to the mortgage company without selling your home or taking a second mortgage on your home. Basically, once you have made the extra payments to the mortgage company, it will not be easy to access the extra payments if you need to.

Once the extra payments are applied to the principal, they cannot be applied to current mortgage payments if you suffer a financial setback. You cannot, for example, pay extra for three months and then skip a month if money gets tight.

The funds needed to complete your mortgage acceleration plan may not be available if you die or become disabled prior to paying off your mortgage. Your family will be on their own to finish paying off the mortgage despite your efforts to pay it off early.

With this option, you purchase a cash value life insurance policy instead of making extra payments to your mortgage company. Eventually, the cash value of the life insurance policy will meet or exceed the balance of the mortgage. At that time, you can cash in your life insurance policy and pay off the mortgage.

Since you own and maintain total control of the life insurance policy, there are several advantages to utilizing this option.

If you die before the mortgage is paid off, the policy’s death benefit can be used by your family to pay off the mortgage.

You can borrow or withdraw funds from the policy in the event of an emergency or opportunity.

If you become disabled and the policy has the waiver of premium benefit, the plan is self completing.

You have the flexibility to use the policy’s cash value for other needs, such as college education funding or retirement.

The policy’s cash value accumulates tax deferred.

The downside to using this option is that if you are in your 50s or 60s, or in poor health, this option might not be available to you, or may be very expensive.

Selecting the correct option is very important! As you can see, there are different advantages to each option. Furthermore, neither plan is right for EVERYONE. You should custom tailor your plan based on when you want to have your mortgage paid off and what your budget will allow you to do.

By requesting this information, you obviously wish to save thousands of dollars on your mortgage! After all, who doesn’t? The next step is to request your PSA (Personal Savings Analysis). All you need to do is provide us with some basic information with regards to you and your mortgage. Based on the information you provide, we will be able to show you:

How Much Money You can Save!

How Much Your Savings Can Grow To!

Option 1 versus Option 2

When you are finished reviewing your PSA, you can confidently make a decision as to how much you want to save and how you want to do it. Best of all, your PSA is free (a $35 value) and yours to keep even if you decide NOT to implement either option.

There are two ways to get your Personal Savings Analysis!  Fill out the PSA request form. Or call us with the information. We will take the information, create your Personal Savings Analysis, and schedule a time to review it with you… at your convenience… in your own home!

Like I said, we make this very easy for you. You owe it to yourself to get this information! And yes… I said your PSA is completely free and yours to keep, even if you decide not to start an Acceleration Plan.