Here Is An Simple Way To Save A Lot of Money On Your Mortgage
We all pay the same amount for our home loan each month, so why not try this idea that allows you to continue to pay the same amount, but saves you a lot of money on your mortgage? It is a really simple concept, but it has a powerful result.
Most people nowadays get paid every two weeks. If you are like most people, when you are first paid, you spend a lot because the cash is there, but cash gets tight towards the end of this two week period. Yet, if you examine your expenses, they seem to remain relativelyfairly fixed.
The reason for this phenomena is that we pay the bills and spend extra e have the cash, and when we don’t, some bills don’t get paid. Experts advise that the best way to avoid this problem is to budget your funds, and since your home loan is probably your biggest expense, that is the most sensible thing to budget.
You can shave as many as seven years off the term of your home loan with this method, and save thousands of dollars in interest while you do. For an $80,000 mortgage that has a 30 year term and a 7% interest rate, this easy trick can save as much as $25,000.
How to accomplish this this off- budget your mortgage payment out of each paycheck instead of the last one of the month. (Most people use the second pay of the month to pay the mortgage since it will get to the bank by the due date.)
When you pay one half of your home loan two weeks early, the effect accumulates, and your mortgage is paid off ahead of time. When the mortgage is paid off earlier, the interest total is less.
Because of the way mortgage interest is calculated and paid down, most of your initial mortgage payments are used to pay interest, and only a small portion goes to principal. While you are paying this small bit of principal, the interest contnues to grow. The faster you make those interest payments, the more quickly you will start to substantially lower the principal. This will cause an early payoff of your total mortgage!
Your bank may have a special form for this type of operation, but even if they don’t, just send your payment in with your mortgage number clearly indicated on it. You can also duplicate your payment forms and just change the month it is intended for.
Taxation, Money And Banking, With The Infinite Banking Concept By Becoming Your Own Banker
Could you live ten days without money? Try it and find out what an asset money really is. Assets have a tendency to multiply. The problem is hardly anybody treats their money as an asset.
It has been written that “The value of an asset increases exponentially while the value of your labor only increases incrementally.”
The Rate of return on their money, for many, seems to be more important than the return of their money. But the real value of money is destroyed when rate of return is the focus. This is because someone else is in control of the actual money.
Think about this:
Whose bank do you deposit your paycheck in?
A commercial bank or one that you own?
Do you or someone else profit the most from this way of doing business?
Do not ever think that you can multiply your wealth by dividing it up. Allowing others to have access to your money by placing it on account at their bank, gives that bank control over your money. You automatically become second in command of your money by doing this. When the bank controls your money, you do not and they make money off your money while you pay the fees, the charges and all other costs associated with banking and financial institutions.
That is why everyone needs to read about the Infinite Banking Concept in the book Becoming Your Own Banker by R. Nelson Nash. Nash explains how, you can take control of your money, which is the asset that can build real riches and lasting wealth. This process is called the Infinite Banking Concept or IBC. IBC allows those who utilize Becoming Your Own Banker, aka BYOB, to recover the costs associated with the banking equation. What is the banking equation you might ask? The banking equation is simply this:
You give up interest you could have earned by paying cash or you lose money by paying someone else interest when you use their money. You lose money regardless.
But when you practice the Infinite Banking Concept, you can pay cash for your purchases and earn the interest that banks or finance companies would have otherwise earned off you. This is because you are now using your money as an asset and the growth becomes exponential when compared with what happens when you put your money in a bank owned by someone else, or with an investment firm.
Tom McFie PhDis a professional financial coach and is widely known for helping people recover the money they currentley spend. Don’t Make another payment until you have viewed his Infinite Banking Video Then Contact him he can help you You can get a unique content version of this article from the Uber Article Directory.
Securing A Homeloan In A Time Of A recession. Is it Possible?
A recession brings on economic uncertainty. It’s one of those spiral effects. Consumers aren’t willing to spend money and banks aren’t always willing to lend it.
A recession is a good time to buy a home because interest rates tend to be lower, which will save the buyer thousands of dollars. But that doesn’t mean you should go into the home loan process unprepared. First of all, pull your credit report.
A high credit score is your key to getting in. Do not have a high credit score’ Especially during a recession your chances of getting approved are very low and even if you are approved, the interest rates will be extraordinarily.
Money in the bank is needed secondly. A direct deposit, between 15-20% is needed along with reserves. Reserves are the money put aside in the bank for repayment of the first two to three months of the loan. The bank needs to make sure you have the appropriate income for the loan.
Make sure you can verify your employment, income and assets. It’s not just enough to tell the home loan provider that you have a job and some money in the bank. You will need to provide documentation like paycheck stubs and bank account statements in order to secure a home loan.
This documentation is even more important if you are applying for a home loan during a recession because you need to prove to the lender that you can afford the home loan and will make your monthly home loan payments. Be prepared to provide at least three months worth of documentation. Collect the necessary documentation and have it on hand prior to applying for the home loan in order to speed up the application and approval process.
Although the current economy does not look promising, do not fear the chance of earning a loan. Home loaners still need business, but they will remain more selective until the economy changes. Inform the lender that you are speaking with other lenders and they will be more inclined to offer a cheaper deal.
Buying a home can be time consuming and intimidating, and buying a home in a recession can be downright frightening. But with some preparation on your part, you should be able to qualify for a home loan with competitive rates. See your home loan provider for answers to your specific questions. They can take the time to examine your situation and come up with a home loan that best suits your needs, recession or not.
Tom Martens is the content coordinator for South Arica?s leading Homeloans portal which amongst others offers Bond origination services for all major banks.