4 Easy Ways To Stick It To The Bank And Keep Their Profits In Your Pockets!
We all want to be mortgage free, right?
Most people just dream of it but never actually take any positive action to make it happen. Blaming lack of knowledge... or the time to learn the knowledge. It is this, and this alone, that separates the truly wealthy from the very ordinary.
There are several steps to getting your mortgage paid off quickly and it can be done in as little as 7 and a half years. (assuming you start using the steps i am about to show you and you are in the first years of your mortgage)
The basic principles are very simple.. (not easy, there is a big difference) but you need to be organised and consistent. If you are disorganised you first need to sort out your mindset, because you are probably running round in circles getting nowhere fast, and likely its not just the financial are of your life that is affected.
Here is a list of 4 things you can do right now to start reducing your debt;
1) Check your credit card statement. I bet your interest is over 16%. Often its as high as 24%. This isn’t a problem if you pay it out every month in full. Even if you do this check you are paying it on the correct date. By changing the date you pay, you can save interest if you are being charged it as you normally only get 50 days interest free per year.
For the “normal” people who don’t pay their card off you can call up your bank and ask for a reduction in your interest rate. Banks like to keep their customers, and if you look like you might take your business away they will often instantly reduce the rate to 12%. It may only be for 6 months, but in 6 months you make another call!
Believe me this works. I didn’t think this could happen when i first heard this over 10 years ago, but I made that phone call just to prove the guy wrong and got my rate reduced from 21% to 9%. Use the money you save each month to pay into your mortgage. AND remember to call them up each time the interest rate returns to the default amount!
2) Make mortgage payments weekly or fortnightly instead of monthly. Fortnightly payments alone will reduce over 2 years off the length of your loan and weekly payments will reduce it by over 7 years. Simply divide the monthly amount by 4 or 2. Not only will this reduce the amount of interest but you will also pay extra by default, since there are 13x 4 week periods in a year rather than 12. This is very simple to do and doesn’t cost you anything that you notice. It will save you only a few years but if you calculate your payments in a 12 month period that money is in your pocket and not the banks!
3) Put extra payments in your mortgage account whenever you can. Tax returns, Small windfalls. Refunds from returned items. Every little bit helps, no matter how small. For every $1 you pay in during the first five years you can save around $4 in interest. Make this a habit from early on. I guarantee that after 1 year you will be shocked at how much of a difference its made.
4) When you first open your mortgage make the first payment in the first week and then make payments on time. By doing nothing else but simply keeping the account in advance by 1 month you can save 7 months of payments. Of course most of you will already have an existing mortgage, but you can still save money. You won’t get rich but you will save a few thousand dollars.
Ultimately, if you use a combination of these techniques you can save a serious amount of money and time. It alone will not make you rich and free, but, if it’s used as part of a bigger plan it will get you there quicker. Anyway, the money is much better in your pocket than in the hands of the greedy Banks .
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