Comments on: Question of the Day – Reader Question http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/ A personal finance blog dedicated to discussing such topics as budgeting, asset allocation, 401K, IRA, cash flow, insurance, financial planning, portfolio management, and other areas in personal finance. Thu, 24 May 2012 12:43:16 +0000 hourly 1 http://wordpress.org/?v= By: Aaron http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/comment-page-1/#comment-402160 Aaron Thu, 12 Feb 2009 03:53:30 +0000 http://allthingsfinancialblog.com/2006/10/19/question-of-the-day-reader-question/#comment-402160 I'd agree, pay off the HELOC and then work on the mortgage. However, I would not keep the HELOC balance at zero. There are several "secrets" you can apply to your HELOC to lower payments, earn credit card rewards, and get cash back. I've written detailed explanations of these creative money management techniques in an ebook that can be downloaded here: http://thepayground.com/heloc_home.html. Aaron I’d agree, pay off the HELOC and then work on the mortgage. However, I would not keep the HELOC balance at zero. There are several “secrets” you can apply to your HELOC to lower payments, earn credit card rewards, and get cash back. I’ve written detailed explanations of these creative money management techniques in an ebook that can be downloaded here: http://thepayground.com/heloc_home.html.

Aaron

]]> By: Money Merge Account http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/comment-page-1/#comment-223736 Money Merge Account Fri, 01 Feb 2008 20:51:54 +0000 http://allthingsfinancialblog.com/2006/10/19/question-of-the-day-reader-question/#comment-223736 tell his grandson to use the MMA with the money he will be getting so it saves him more money in the long run. tell his grandson to use the MMA with the money he will be getting so it saves him more money in the long run.

]]> By: Lee Matthews -- Financial Concepts West http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/comment-page-1/#comment-222116 Lee Matthews -- Financial Concepts West Wed, 30 Jan 2008 15:54:57 +0000 http://allthingsfinancialblog.com/2006/10/19/question-of-the-day-reader-question/#comment-222116 "Which would be the best use of the extra $1000? Should I funnel that money towards the high interest HELOC? Or should I put that money towards the fixed equity loan’s principle and lower the overall payoff?" Use the HELOC as an "interest cancellation account" and use it to accelerate the equity in your home. YOu'll payoff your loan years sooner than you thought possible. It's not the interest rate of the HELOC that is important -- rather it's the amount of interest that your paying that is what you should pay attention to. Today’s Real Estate market means that folks can no longer count on appreciation to build home equity. Those who realize that they need to pay down their current mortgage debt are looking for alternate ways to aggressively (yet safely) build equity. And they've discovered a perfect online system to do that; they can focus on their wealth accumulation goals while accelerating their equity simply by using a Home Equity Line of Credit to ‘power’ the Money Merge Account™ financial solutions program. A typical 30 year loan (of whatever type) can be paid down in 1/3 to 1/2 the time — it's a great way to save *huge* amounts of income by eliminating a mortgage amortization front-end interest load. (On a million-plus dollar home, I've personally seen where the Money Merge Account™ program will save the homeowner $750,000 in interest charges!) And the best thing – homeowners don’t have to refinance their existing mortgage or, in most cases, make any adjustments to their lifestyle. It is unfortunate that most of us were never taught to follow three essential principles: (1) Avoid paying interest, whenever possible, (2) Use other people’s money, whenever possible and (3) Find and use a financial system that will guide you, especially if you have the tendency to go off-track. The Money Merge Account™ software and the program’s counselors use these principles to keep each homeowner focused on their wealth accumulation goals. I’d be happy to provide further details… “Which would be the best use of the extra $1000? Should I funnel that money towards the high interest HELOC? Or should I put that money towards the fixed equity loan’s principle and lower the overall payoff?”

Use the HELOC as an “interest cancellation account” and use it to accelerate the equity in your home. YOu’ll payoff your loan years sooner than you thought possible.

It’s not the interest rate of the HELOC that is important — rather it’s the amount of interest that your paying that is what you should pay attention to.

Today’s Real Estate market means that folks can no longer count on appreciation to build home equity. Those who realize that they need to pay down their current mortgage debt are looking for alternate ways to aggressively (yet safely) build equity.

And they’ve discovered a perfect online system to do that; they can focus on their wealth accumulation goals while accelerating their equity simply by using a Home Equity Line of Credit to ‘power’ the Money Merge Account™ financial solutions program.

A typical 30 year loan (of whatever type) can be paid down in 1/3 to 1/2 the time — it’s a great way to save *huge* amounts of income by eliminating a mortgage amortization front-end interest load. (On a million-plus dollar home, I’ve personally seen where the Money Merge Account™ program will save the homeowner $750,000 in interest charges!)

And the best thing – homeowners don’t have to refinance their existing mortgage or, in most cases, make any adjustments to their lifestyle.

It is unfortunate that most of us were never taught to follow three essential principles: (1) Avoid paying interest, whenever possible, (2) Use other people’s money, whenever possible and (3) Find and use a financial system that will guide you, especially if you have the tendency to go off-track. The Money Merge Account™ software and the program’s counselors use these principles to keep each homeowner focused on their wealth accumulation goals.

I’d be happy to provide further details…

]]> By: » Great Blog Articles From This Past Week on Consumerism Commentary: A Personal Finance Blog http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/comment-page-1/#comment-34983 » Great Blog Articles From This Past Week on Consumerism Commentary: A Personal Finance Blog Mon, 23 Oct 2006 02:42:47 +0000 http://allthingsfinancialblog.com/2006/10/19/question-of-the-day-reader-question/#comment-34983 [...] AllFinancialMatters, an in-real-life financial planner helps a reader decide how to deal with an extra $1,000. [...] [...] AllFinancialMatters, an in-real-life financial planner helps a reader decide how to deal with an extra $1,000. [...]

]]> By: LAMoneyGuy http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/comment-page-1/#comment-34140 LAMoneyGuy Thu, 19 Oct 2006 22:11:49 +0000 http://allthingsfinancialblog.com/2006/10/19/question-of-the-day-reader-question/#comment-34140 Weary, I would like to have seen someone disagree with the group, but there just isn't any justification. The HELOC carries the higher current rate, and the risk of the rate increasing in the future. Weary, I would like to have seen someone disagree with the group, but there just isn’t any justification. The HELOC carries the higher current rate, and the risk of the rate increasing in the future.

]]> By: WearyTraveler http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/comment-page-1/#comment-34131 WearyTraveler Thu, 19 Oct 2006 21:26:48 +0000 http://allthingsfinancialblog.com/2006/10/19/question-of-the-day-reader-question/#comment-34131 Hmmm.... I'd figure there would have been at least someone advising to put more money into the fixed mortgage. I can understand paying off the higher rate note early, then throwing more money at the other note. Does it make any sense whatsoever to pay off the fixed rate early? Wouldn't more towards the principle cut down the total amount of money paid towards the fixed note? Just playing devil's advocate... Hmmm…. I’d figure there would have been at least someone advising to put more money into the fixed mortgage. I can understand paying off the higher rate note early, then throwing more money at the other note. Does it make any sense whatsoever to pay off the fixed rate early? Wouldn’t more towards the principle cut down the total amount of money paid towards the fixed note? Just playing devil’s advocate…

]]> By: Denise http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/comment-page-1/#comment-34121 Denise Thu, 19 Oct 2006 20:44:10 +0000 http://allthingsfinancialblog.com/2006/10/19/question-of-the-day-reader-question/#comment-34121 HELOC for all the reasons stated above, emphasis on the VARIABLE rate. Things seem to have flattened out a bit, but my Prime + 1 (or whatever) when I got it 3 years ago jumped to 6%, 7%, 8% seemingly over night. Actually, I paid it off before it got to 8%, but it was crazy what it did to my payment (interest only). Get rid of it, then only use it if you need it. Fixed is good, variable bad in today's economy. HELOC for all the reasons stated above, emphasis on the VARIABLE rate. Things seem to have flattened out a bit, but my Prime + 1 (or whatever) when I got it 3 years ago jumped to 6%, 7%, 8% seemingly over night. Actually, I paid it off before it got to 8%, but it was crazy what it did to my payment (interest only). Get rid of it, then only use it if you need it. Fixed is good, variable bad in today’s economy.

]]> By: Matt http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/comment-page-1/#comment-34106 Matt Thu, 19 Oct 2006 19:57:36 +0000 http://allthingsfinancialblog.com/2006/10/19/question-of-the-day-reader-question/#comment-34106 I'd pay off the HELOC first; there's a higher interest on it and it's the smaller of the two. Once you pay it off (about 15 months based on the info given) you can apply the extra $1000 plus whatever you were paying on the HELOC to the equity loan. Splitting them means you're paying interest longer on both of them. I’d pay off the HELOC first; there’s a higher interest on it and it’s the smaller of the two. Once you pay it off (about 15 months based on the info given) you can apply the extra $1000 plus whatever you were paying on the HELOC to the equity loan. Splitting them means you’re paying interest longer on both of them.

]]> By: Rob http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/comment-page-1/#comment-34079 Rob Thu, 19 Oct 2006 17:57:52 +0000 http://allthingsfinancialblog.com/2006/10/19/question-of-the-day-reader-question/#comment-34079 I don't see the need for an emergency fund with an accessible line of credit. I would pay down the HELOC before any term note, car loan, or emergency fund, becaues the HELOC is liquid and can be reborrowed if necessary. I don’t see the need for an emergency fund with an accessible line of credit. I would pay down the HELOC before any term note, car loan, or emergency fund, becaues the HELOC is liquid and can be reborrowed if necessary.

]]> By: Foobarista http://allfinancialmatters.com/2006/10/19/question-of-the-day-reader-question/comment-page-1/#comment-34075 Foobarista Thu, 19 Oct 2006 17:42:41 +0000 http://allthingsfinancialblog.com/2006/10/19/question-of-the-day-reader-question/#comment-34075 Also, it's good to pay down the HELOC since it's likely variable-rate and already at a pretty high rate. The fixed-rate mortgage is probably OK as it is; even if he wants to pay it down, he should make sure he's funding any other retirement vehicles (401K/Roth) and has a well-padded efund before going after it. Also, it’s good to pay down the HELOC since it’s likely variable-rate and already at a pretty high rate. The fixed-rate mortgage is probably OK as it is; even if he wants to pay it down, he should make sure he’s funding any other retirement vehicles (401K/Roth) and has a well-padded efund before going after it.

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