Comment on Heloc
I have a comment on Heloc's and this new mortgage accelerator program that I spoke of a couple of days ago. I read, with interest, the comments that were made from the mortgage company in Floriday, Mike, I think it was. I've been doing some research on the program and based on my findings, I think that this is actually a good thing for people. The traditional way of paying off your mortgage early is by adding an extra amount of money each month that will go towards the principal. These days, with 3.7 million homes going into foreclosure, most people don't have extra money each month to add to their payment. The mortgage accelerator program is a financial dashboard for people to see where they are going and how to get there and also educates the homebuyer as to what the consequences of their choices will be. It is being compared to The Secret, don't look at where you are but rather, look at where you want to be. It is true that when you front end load the $3500 that the program costs, your loan does increase substantially, that is what the banks have been enjoying for years. The banks want to collect on that interest, it ends up being about 200% of the initial amount borrowed. With a fixed loan, you end up paying most of this up front, in the beginning. In my opinion, I think that this accelerated mortgage program may not be a bad thing, in fact, I think that it will be a blessing to many people.
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