Below is a "basic" overview video of how an MMA "Type" mortgage acceleration program works and why it is powerful. There seems to be a lot of fundamental misunderstanding how these type of programs work. I am trying to shed some light on how and why the MMA is very powerful and how it can be a great thing for the right, potential borrower.
Personally, I can honestly say the MMA is NOT for everyone. I always perform a suitability test and run a specific and individualized analysis for anyone considering this type of program (or any type of loan program I offer). One of the biggest misunderstanding is how you can accelerate your mortgage without effecting you monthly cash flow that you would normally have for other expenses, and other potential investments. Well a lot of this lies in the inherent feature of a second position HELOC, of open ended interest only payment calculations and the total due based on the outstanding amount. It also has a lot to do with "timing" and actually floating the banks money and using this float period, "consistently" to cancel out the "daily" interest accumulation on your closed ended First position 30 year fixed mortgage....
Yes, I know it sounds complicated, but it is a lot more simple then it appears when you understand the basic, yet abstract, financial concept that the banks have been using to their advantage since the beginning of time.
This concept of "Mortgage Acceleration" is NOT a new concept on a "global" perspective, it is just fairly new here in the USA. It has been used effectively for decades in Australia, the U.K. and other parts of Europe. Google "Virgin One account"....You will see the results for an institutional level product that works on this same concept that is used effective over in the U.K. The Virgin One Account is offered through RBS (Royal Bank of Scotland) and is sponsored and promoted through the "Virgin" Name (Richard Branson Billionaire guy)
The MMA uses a slightly different variation then the traditional "Virgin One Account" type variation. The MMA allows you to keep your traditional, first position, closed ended interest 30 year fixed mortgage (or what ever mortgage you have currently) and works on utilizing a smaller second position Home Equity Line of credit which has "open ended interest" calculations. The MMA software (of course is optional) helps you apply the interest cancellation process as efficiently as possible and actually give you a final target date of when you will be "Mortgage Free"...I like the software because it helps me stay on target and it is a lot more efficient than if I tried to do this on my own.
Now, let me make something clear....I believe in this whole general concept, and specific technique of Mortgage Acceleration. You can always do this on your own without having to use the specific methods of the MMA or the MMA software (personally I would not want to attempt this on my own). You Don't need the MMA to accelerate your mortgage and there are other similar products ou there that are fairly decent and powerful products. I just want to really dispel a lot of the misunderstanding with this type of product...There is a lot of "misinformation" and just plain misunderstanding.
There are also different "Schools of thought". Some feel you should NEVER pay off your mortgage on your primary residence because you would miss out on the tax benefits and take away from your cash flow to be used for other types of investments to grow your wealth (remember the MMA does not effect your cash-flow).
Then there is the "School of thought" that you should pay off everything you owe in the shortest time possible, saving hundreds of thousands of dollars in unnecessary interest charges while still having the flexibility and available cash flow to invest wisely for the future....This is what the MMA addresses.
The information is "out there".... you decide what is BEST for you
Enjoy the Video
Keith Gill
http://www.LoanAcceleration.net
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