First off, I want to say that I'm a loan officer and our industry is going through a huge revolution. There are several products out there that can save a home owner $2-300,000 on the interested paid on there home. Would it be better for them to invest that money instead of paying off their home? I don't know much about stocks investments. Check the product out on my web page at mortgage and any feed back to help my customers would be greatly appreciated.

 

Why are mortage brokers hard selling these accelerated payment programs now? I am going though the mortage process again now, and I don't remeber ever seeing such a hard sell. How much do you guys make for signing someone up for this?

 

Why do you have to sign-up for something to accelerate your mortgage payoff? Have things changed since I paid off my mortgage 10 or so years ago?

My mortgage was a plain vanilla, 30 yr fixed rate contract.

Back then all I did to pay it off more quickly was to add more money to my monthly payment [which was to be applied to the principle.]

 

[QUOTE=trapper,May 24 2007, 05:56 PM] Why do you have to sign-up for something to accelerate your mortgage payoff?

 

For the average person, they need to pay their house off before investing in a risky situation like the stock market. If they can offset the interest with less risky mutual funds, or if the APR is low enough CDs etc., then that is one thing. I do not consider mutual funds the same as literally investing in the stock market by yourself, as there are as many different types of mutual funds as there are beer. Some risky, some with significant %'s in bonds, international markets, currencies, etc.

The average person that doesn't understand this ALREADY does NOT need to be putting this money in the stock market. The stock market is not a friendly place to those with a lot of debt and inexperience. Again, I'm refering to investing by one's self. I know some very* educated people on the market system that have lost a lot of $$ some years, even on overall OK years for the market in general.

There are too many factors to answer that question with a blanket statement like yes or no.

 

Good info "sahtt." If you guys haven't visit the website or see the video then it would be a little tough for me to explain why people save hundreds of thousand of dollars on a mortage of about $300,000. Interest is calculated on daily balance so if your daily balance is lowered drastically every month by your whole paycheck then your balance would be lower therefore you pay less interest. This compounds therefore for you can save hundreds of thousand of dollars. In Las Vegas News 3 did a 6 part segment on this type of program and is getting a lot of coverage.

 

You are correct about applying a little more to the payment so you can pay it off quicker. Many people feel that once they put that money in then they are committed and are not able to withdraw that money if they need to later other than refinance and that would be costly. This program is a line of credit where you have the options to withdraw your money 24/7. They give you an ATM, Check book and online bill all for free.

 

If you want call me so I can give you some options. I promise I will not try to sell you on anything. 702-789-9988 Phillip

 

Thanks for the offer, but an accelerated program doesn't make sense for me. However, for future houses, it's definitely something I'll be considering.

All in all, for the right people, I can see this sort of program working well for the right people. But, I think the right people are few and far between. It just seems odd to me that these programs came out of nowhere, and now every broker is pushing them. Must be a high markup product?

 

Actually not true on the mark up. When you talk about an accelerated program are you referring to a bi-weekly or paying a little more into the payment? Because this program is neither of those. Check out my link on the top post.