| Imagine how it would feel to have your home | | | | spending on a credit card during the month, clients are |
| completely paid for ... with the payments you were | | | | able to keep more money in the HELOC for a longer |
| making on it now going into "wealth-building" strategies | | | | period. |
| for you! The fact is less than 3% of all Americans now | | | | 3. Consult the online software once month before |
| own their own home. However, in Australia and Great | | | | making the mortgage payment. The software will |
| Britain over 35% of their people own their own homes. | | | | direct you to pay the optimal amount of money to |
| What do these home owners know about being able | | | | your 1st mortgage to ensure you are paying as little |
| to payoff their homes so much faster? ... It's new | | | | interest as possible. |
| "state-of-the-art" technology and software that guides | | | | Many home owners have consumer debt that needs |
| you through an easy way to build home equity 3 times | | | | to be paid off. Consumer debt comes in the form of |
| faster and actually help you pay off a typical, 30-year | | | | car loans, credit card balances, student loans, second |
| mortgage in 1/3 of the time it normally takes. This new | | | | mortgages, and many others. The MCA system |
| technology is called a Mortgage Checking Account ... | | | | directs clients to pay these debts off using the funds |
| or MCA. | | | | available in the HELOC. By doing so, the debts are |
| With a traditional 30-year mortgage, in the early years | | | | consolidated in the HELOC environment. Now that the |
| of the loan most of the monthly payment goes toward | | | | debt is consolidated in the HELOC, we can attack it |
| paying the bank interest. This type of loan structure | | | | more efficiently for a couple of reasons. |
| heavily favors banks because almost all of a | | | | 1. Normally the interest rate in the HELOC is lower than |
| borrower's monthly payment goes toward interest! In | | | | on consumer debt. |
| fact, it's not until the 20 year 2 month mark that the | | | | 2. Income can now sit against this debt while it's not |
| principal portion of the payment equals the interest | | | | being used. |
| portion. Since the average American only stays in their | | | | 3. HELOCs aren't amortized loans. As the period over |
| home for 5-7 years, they barely make a dent in the | | | | which a loan is amortized increases, monthly interest |
| principal of their mortgage. | | | | requirements to satisfy that loan will decrease. |
| We have been conditioned by the banks in the U.S. to | | | | Example: If I have a $20,000 car loan amortized over 5 |
| make us think we need to keep most of our money in | | | | years at 7% interest, my payment will be $396. During |
| checking accounts. Most of these checking accounts | | | | the early years of this loan, only a small portion of this |
| pay very little or no interest at all. Then they take our | | | | payment is going to principal and the rest is going to |
| money and loan it out to their customers (borrowers) | | | | the bank as interest. This same $20,000 paid off by a |
| for high interest rates! It's a great deal for the banks | | | | HELOC at 9% interest will only require a $150 payment |
| but not a good deal for us. | | | | to interest. The other $246 ($396-$150) can now be |
| Also, in the U.S. we have separate checking accounts, | | | | applied directly to the principal of the debt. Since more |
| mortgage accounts, HELOC's and credit card | | | | money is going towards the principal Therefore, the |
| accounts. However, in Australia and Great Britain | | | | $20,000 will be paid off much quicker and I will pay far |
| home owners have all of their accounts combined into | | | | less in interest. |
| one account. | | | | Through using this program, home owners' monthly |
| This new software system teaches clients the | | | | payments become more efficient. Through consulting |
| benefits of combining their mortgage, savings and | | | | this new software once a month before making their |
| checking accounts. Through combining your financial | | | | mortgage payments, they find the optimal amount to |
| accounts, you create an environment where your | | | | pay for each month. This optimal payment will often |
| money is working for you instead of working for the | | | | include extra principal being paid to the mortgage. Since |
| banks. This is possible because your income can now | | | | this extra principal paid moves the client further down |
| sit against your debt while you're not using it. When a | | | | the amortization schedule, the next minimum payment |
| pay check is deposited into a mortgage account, the | | | | that gets sent to the lender will now have a greater |
| balance in the mortgage account is instantly reduced. | | | | portion allocated to principal. Therefore, less of the |
| Therefore, you are getting charged interest on a | | | | payment will be going toward interest causing the |
| smaller principal balance. Every day that the balance is | | | | payment to be more efficient. |
| reduced, you are saving money. | | | | Many people wonder why it makes sense to pay |
| A traditional fixed mortgage does not allow borrowers | | | | money from a higher interest rate HELOC into their |
| to deposit their money into the account one day and | | | | lower interest rate 1st mortgage. They are concerned |
| then pull that money back out the next day. So in | | | | that by transferring $5,000 of debt from a lower |
| order to allow your money to reduce the mortgage | | | | interest rate loan to a higher interest rate loan they will |
| debt and still be accessible to you, we use a Mortgage | | | | be paying more interest. However, by using the |
| Checking Account. Mortgage Checking Accounts or | | | | program a person will actually pay less in interest if the |
| MCAs are very specific types of Home Equity Lines | | | | $5,000 debt is the HELOC than in their 1st mortgage. |
| Of Credit or HELOC. A HELOC can be used as a | | | | Less interest is paid because the average daily |
| Mortgage Checking Account because it is an | | | | balance in the HELOC is actually much less than |
| open-ended loan. An open-ended loan is one in which | | | | $5,000. Example: Let's say that I transfer $5,000 from |
| you can pay money into them and pull that money | | | | my 9% HELOC to my 6% 1st mortgage creating a |
| back out when you want it. The HELOCs we use will | | | | $5,000 debt in the HELOC. Now if I get paid $4,500 the |
| have check books that draw directly on them. Often | | | | next day and deposit this pay check in the HELOC, I |
| they will have credit cards that draw on them similar to | | | | now only have a $500 balance. Therefore, I'm being |
| how a debit card draws on a checking account. Also, | | | | charged interest on only $500. I'd rather pay 9% |
| you can transfer funds in and out of this account | | | | interest on $500 than 6% interest on 5,000. The |
| online. These features make it possible for clients to | | | | interest paid to the HELOC depends upon the average |
| use HELOCs as their new checking accounts. Interest | | | | daily balance not the amount of debt transferred. The |
| in a HELOC is calculated on a daily basis. Therefore, | | | | effectual interest rate is the real interest rate someone |
| each day that your income is sitting in your HELOC, | | | | pays on the debt they are working to pay off. The |
| reducing the balance in the HELOC, the bank is | | | | new early motgage payoff system has a very low |
| charging you interest on a smaller balance. For | | | | effectual interest rate due to its efficiency of paying |
| example, if you have a $10,000 balance in your | | | | off debt. To find the effectual interest rate on the debt |
| HELOC and deposit a $5,000 pay check into the | | | | use the following equation. |
| HELOC, you will now be charged interest on $5,000 | | | | Annual Effectual Interest Rate = (Total Interest Paid / |
| instead of $10,000.The MCA does not replace a client's | | | | Total Debt) / # of yrs to payoff. |
| first mortgage. Therefore, they will have 2 mortgage | | | | The online software is vital to the success of this |
| accounts: their current 1st mortgage, and the HELOC | | | | program because it shows home owners exactly |
| or MCA. These two accounts are illustrated in the | | | | what to do with their money so that their money is |
| following graphic along with the 3rd component of the | | | | working as hard as it possible can be. The software |
| program, the credit card. | | | | considers the balances and interest rates on their |
| The credit card is a valuable tool in this program | | | | loans as well as their income and expenses to |
| because by purchasing your monthly expenses on a | | | | calculate the optimal monthly mortgage payment. This |
| credit card you are allowing your income to stay in the | | | | monthly mortgage payment is a very important |
| MCA longer. The longer your money remains in the | | | | number because it ensures that the least amount of |
| MCA, the longer you are charged interest on a smaller | | | | interest is being paid. Some people ask why they can't |
| principal balance. As long as the credit card is paid off | | | | just do this program on their own without the |
| in full each month, you don't have to pay any interest | | | | software. If they try to do this program without the |
| on the money you spent from the credit card. Since | | | | guidance of the software, they will likely create too |
| the MCA is used as the new checking account, the | | | | much debt in the HELOC costing them more in interest. |
| balance in this account will be fluctuating throughout the | | | | Likewise, if they are transferring too little to the 1st |
| process of paying off the mortgage. When a deposit | | | | mortgage they aren't taking full advantage of the |
| is made, the balance decreases. When the credit card | | | | money they do have. This new software computes |
| is paid off or when mortgage payments are made, the | | | | the necessary data to ensure that the home owner's |
| balance increases. | | | | money is used as efficiently as possible. If |
| In a simplified scenario, here is how the program works. | | | | do-it-yourselfers try this on their own, they will find that |
| At the beginning of the month a client will make a | | | | the work required in calculating an optimal payment is |
| mortgage payment of the amount determined by the | | | | very time consuming. In addition, it will be next to |
| software. The money for this payment will come from | | | | impossible for them to payoff their home as efficiently |
| the MCA or HELOC and will be paid into the 1st | | | | as our system. On average, if it takes them 2-3 |
| mortgage. This transaction reduces the debt in the 1st | | | | months longer to payoff their home doing it |
| mortgage and moves the client further down the | | | | themselves, they have already paid for the program. |
| amortization schedule. This same transaction increases | | | | In conclusion, when a person commits to enrolling |
| the debt in the HELOC. Now, we are able to deposit | | | | themselves into this new Software "System", they are |
| our paycheck into the HELOC causing this money to | | | | committing themselves to changing the way they think |
| sit against the newly created debt. This deposit | | | | about their money and view finances. It will teach a |
| reduces the balance in the HELOC which means that | | | | person to think more their money and view finances. It |
| the bank is instantly charging us less interest. Now that | | | | will teach a person to think more like a bank, and less |
| the balance is reduced, we spend money on the credit | | | | like the average American who struggles to get out of |
| card to allow our money to sit in the HELOC for as | | | | debt and become financially free. The benefits of the |
| long as possible. We carry this reduced balance for | | | | new Software "System" to the client are threefold. It |
| the majority of the month. At the end of the month, | | | | teaches a person to think of their money differently |
| we will pay the credit card off before incurring any | | | | and act more like a bank so that they become more |
| interest charges from the credit card. Essentially, clients | | | | liquid. Once a person reaches a level of liquidity, they |
| need to follow 3 simple steps each month to use this | | | | are able to pay down their debts more efficiently. |
| program effectively. These steps are as follows: | | | | After, or even during the process of becoming debt |
| 1. Change where you deposit your money. Instead of | | | | free, we teach the client how to build wealth. |
| storing your money in a checking account that doesn't | | | | Through this new, Software System, the client will be |
| earn interest, deposit the money into the HELOC so it | | | | educated to make smarter financial decisions |
| can work against your debt. | | | | throughout the remainder of their life. This system |
| 2. Pay for your monthly expenses using a credit card | | | | helps people get in control of their finances and forces |
| and pay off the balance each month. Through | | | | their money to work harder for them. |