Obviously there is some turmoil in today's real estate market. Sub-prime lenders provide mortgage loans for a lot of people who really can not afford the loan. And within a year or so, many of these individuals could make their monthly payments and eventually they were excluded. For many, the only choice for a lower mortgage payments to refinance at lower interest rates. Unfortunately, in today's market, it is not an option the banks offer many home owners. However, there is a certain type of homeowner that it is easier than one might think to significantly reduce those mortgage payments. And oddly enough, this guy is a homeowner with two mortgages. Specifically, a HELOC (Home Equity Line of Credit ).
HELOC owners have much more freedom then they had ever achieved. The fact is, there are some simple ways that the average Joe can use to reduce a HELOC account. There are no programs to sign up for or pay for services. These methods are easy to implement and can be started right away! In this article I will go through only a few, although there are several others.
1 What is your HELOC balance? In other words, how much money is your monthly payment is calculated HELOC? Maybe you already realize this, but your HELOC payment is calculated based on average daily account balance. For the vast majority of people, this situation changed only once a month: when you pay the bill. However, if you do interest-only payments (as much to do with HELOCs), then your monthly (and more importantly the average day), the status never changes. This means you pay the same amount, month after month. However, if you could find a way to reduce the balance in your HELOC, then your average daily balance of the would also decrease, and the payment will be lower. So far it's all common sense. The higher your loan balance, the higher your monthly payment. Duh. Now comes the innovative methods ...
How much money you have in your checking / savings account? Chances are good that it's more than you need for your monthly expenses. If this describes you, congratulations. You've just discovered the first (and perhaps easiest) way to reduce a HELOC payment. Here's what to do: take all the money that you do not need for monthly expenses, and put it into your HELOC. That's right. Clean your savings account, leaving only what you need for monthly expenses on current account, and dump everything in your HELOC. This is a very important thing: It reduces your average daily balance, and thus the amount on which payments are calculated. In other words, you pay less each month!
Now some May say, "Wait a minute, why would I put all my money in my account HELOC? What if I need to finish up the money for something?" This is the great thing about a HELOC, you can take money from you Whatever you want. This means that if you need a few thousand dollars extra a month to buy a new car, but you've put all your savings into your HELOC, do not worry! All HELOCs come with checks and / or check cards that can be used in the same way as you would a checking account. You can deposit money or withdraw it whenever you want.
to bring here is this: put as much money as you can in your HELOC and let it sit there, offsetting financing (interest) costs. OK, now to # 2
2 Use 0% interest credit card balance transfers.
These things are literally free money. Sign up for a 0% balance transfer credit cards (probably to get these offers from time to time in the mail, if not a great place to shop for one). Then transfer balance credit card limit (or any part you like) on their HELOC account. The money will sit there, month after month (most of these 0% offers for 16-18 months) and lower interest rates offset your monthly payment.
and I have been using these and other equally simple methods for about 7 months now, and have lowered my payment over $ 165! Every month I pay more than $ 165 less than what I was about 7 months. It's $ 165 more each month can be spent on taking my family out to eat, or making investments in, or buy toys!
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