Lower Mortgage Payments Can Increase Wealth


Lower Mortgage Payments Can Increase Wealth
Creating and maintaining wealth is​ a​ very difficult task .​
Ask any millionaire!!! the​ delicate balance of​ living a​ dream lifestyle and holding expenses tight creates this difficulty .​
As a​ financial advisor,​ I​ have assisted people accumulate monies to​ live their dream life while discovering ways to​ reduce their necessary expenses .​
Everyone would agree mortgages are necessary expenses .​
Probably the​ biggest expense most of​ us have .​
Mortgages present the​ opportunity to​ secure income tax deductions while utilizing the​ house to​ live .​
What if​ you​ could reduce your mortgage interest rate to​ 3% and be required to​ pay interest only for 5 years? Would you​ refinance your current house? Purchase another? While refinancing a​ client’s mortgage,​ I​ discovered such a​ mortgage .​
The client will save lots of​ money the​ next few years .​
Here is​ his scenario:
Client #1 $500,​000 Loan Amount
Current
30 Year Fixed @ 6.00%=P&I $2,​997.75/ month
5th year loan balance $456,​989.77
Equity (assuming no appreciation) $43,​010.23
Past
LIBOR ARM @ 3.00%=Interest only $1,​250.00/ month
Applied additional $1747.75 / month to​ principal for 5 years
5th year loan balance $362,​370.82
Equity (assuming no appreciation) $137,​629.18
Creating and maintaining wealth is​ a​ very difficult task .​
Ask any millionaire!!! the​ delicate balance of​ living a​ dream lifestyle and holding expenses tight creates this difficulty .​
As a​ financial advisor,​ I​ have assisted people accumulate monies to​ live their dream life while discovering ways to​ reduce their necessary expenses .​
Everyone would agree mortgages are necessary expenses .​
Probably the​ biggest expense most of​ us have .​
Mortgages present the​ opportunity to​ secure income tax deductions while utilizing the​ house to​ live .​
What if​ you​ could reduce your mortgage interest rate to​ 3% and be required to​ pay interest only for 5 years? Would you​ refinance your current house? Purchase another? While refinancing a​ client’s mortgage,​ I​ discovered such a​ mortgage .​
The client will save lots of​ money the​ next few years .​
Here is​ his scenario:
Client #1 $500,​000 Loan Amount
Current
30 Year Fixed @ 6.00%=P&I $2,​997.75/ month
5th year loan balance $456,​989.77
Equity (assuming no appreciation) $43,​010.23
Past
LIBOR ARM @ 3.00%=Interest only $1,​250.00/ month
Applied additional $1747.75 / month to​ principal for 5 years
5th year loan balance $362,​370.82
Equity (assuming no appreciation) $137,​629.18
Client #2$1.2 Million Loan Amount
Current
5/25 ARM @4.25%=P&I $5,​903.28/ month
5th year loan balance $1,​064,​681.48
Equity (assuming no appreciation)$ 135,​318.35
Proposed
LIBOR ARM @3.00%=Interest Only $3,​000/ month
Applied additional $2903.20 / month to​ principal for 5 years
5th year loan balance$ 971,​261.81
Equity (assuming no appreciation)$ 228,​738.19
You can see from these scenarios this mortgage can be a​ great tool to​ reduce your monthly mortgage payment or​ to​ shave down the​ loan balance thereby increasing your equity .​
This mortgage interest program is​ termed negative amortization .​
Rather than paying off the​ interest over the​ time period,​ you​ are paying of​ a​ small portion of​ the​ interest but not the​ required amount .​
Interest rates can go as​ low as​ 1.25% .​
If you​ want savings refinance your mortgage.



Lower Mortgage Payments Can Increase Wealth



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