I received a not the other day from a gentlemen who does the mortgage accelerator program as a business. He asked me if the harnessing your mortgage program was similar to the mortgage accelerator program. He also mentioned how great it was to help people pay off their mortgage quickly and make a profit at the same time for each new person he helps.
This individual, let's call him Mike, does not understand the power of the mortgage and how you can use it to your advantage to create wealth. The first question I asked was, why would you want to pay off your mortgage quickly and lose the biggest tax break a homeowner has? He still has not written me back with an answer.
I suggested he visit my site, http://ezleadcapture.com/member/wlg.htm, to learn about the new rule of money and specifically how the mortgage relates to the home and why people should be thinking differently about their mortgage.
The new rules of money states, briefly, that you should carry a big long term mortgage--whether you plan on living there for 5 or 30 yrs. This does not mean that you get a big expensive house, however.
A big long term mortgage gives you the biggest tax break. The way to do that is to get an interest only mortgage. The principal part of the mortgage you were paying can now be invested--as well as any extra payments you were making.
Even if you are in year 25 of your mortgage payment, you should refinance so you can take advantage of the tax deductibility you get on the interest payment of your new mortgage.
Let's say you don't refinance and pay off your mortgage, what tax break will you receive with a clear and free home? As previously mentioned, this is the biggest personal tax break you'll ever get, so why would you not refinance to make that happen?
Learn more about the rules of money and harnessing your mortgage to create wealth and residual income at http://ezleadcapture.com/member/wlg.htm
Saturday, December 9, 2006
Why You Should Stop Using Mortgage Accelerator Programs
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4 comments:
So actually how much per average, does a person get a deduction each year on a mortgage interest?
Is 30 years getting a deduction of $3000 or less better than beginning your own business and using your house as a business expense and writing that off, while paying down your mortgage in 7 years instead of 30 AND not having a debt more exciting and relevant?
www.FastMortgageEliminator.com
You can save as much as 35% in taxes on every dollar you pay in interest. In other words, your mortgage is tax deductible at your top tax bracket.
Using a house as part of business will certainly help, but you can only use part of the house as a business expense--the portion that you use as part of your business.
Paying off your mortgage completely will not necessarily give you the biggest tax advantage when use your business as part of the deductions.
I'm not a CPA so I must ask that you seek their counsel for the definitive answer.
Also, check out Rid Edelman's book, "Ordinary People, Extraordinary Wealth"
Why Spend a $1 to get 35 cents back, where did my other 65 cents go?
Classic arugment, it always comes down to the borrower and what they feel they can earn on the money. Of course if you are carrying high interest debt pay it off with equity. To accelerate is a matter of peronal opinion.
You'll have to ask the government for what they're doing with that 65 cents. :)
You are cetainly right about the personal opinion part. But it also comes down to education and the majority of the population is not versed in either option.
As mention in the blog, Ric Edelman is the person who did the study on this and now a lot of other financial planners are coming around to the facts presented in his argument. Plus, he's Oprah's personal financial planner--if it's good for, it's certainly good for me and a lot of other people out there.
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