Why Your Mortgage Is A SCAM (Secret To Mortgage Payoff)

Why Your #Mortgage Is A SCAM (Secret To Mortgage Payoff)! Mortgage loans are one of the biggest SCAMS of all time when it comes to home ownership. In this video I break down exactly what techniques banks use to get you to refinance your mortgage loan to another 30 year mortgage forever. Mortgage literally means death pledge and banks continue to find ways for you to start a new mortgage loan every 7-10 years. Furthermore I break down how a mortgage loan works with an amortization schedule and what your monthly payments actually go to. But never fear, we have devised a strategy to payoff your mortgage early within 5-7 years and it's a tried and true stratgey to financial freedom!

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0:00 Intro
1:29 Why mortgage loans are scams
5:20 The 7-10 year mark in your mortgage loan
8:44 Why a mortgage loan may not fit into today's society
11:05 A solution to the mortgage loan scam
11:40 A tool to pay off your mortgage fast
12:24 The difference between a mortgage & a HELOC
14:52 Average daily interest breakdown
18:36 1st lien HELOC breakdown
23:41 The secret to using a HELOC vs mortgage loan

Disclaimer: I am not an attorney, accountant, or financial planner. This video is intended to be an educational video. This video should not be taken as financial, legal, and/or tax advice. Sam Kwak is a Certified Credit Counselor 11613. This is not a credit counseling session. I suggest that all viewers consult with professionals prior to implementing any or all parts of our strategy.

RECAP OF THE VIDEO:
I start this video with an explanation as to why a 30-year mortgage is like a trap for 21st-century homeowners. The reason being is that Americans (and Canadians) experience frequent life changes that cause them to move or they are eluded to refinancing because the refinance rates might be low. Unfortunately, such an event happens before 7-10 years into the mortgage. In the first 5-7 years, the vast majority of your mortgage payment goes straight to interest payment. A very small portion of your monthly payment actually goes to pay down the principal balance of the mortgage. Fortunately, there is a way to escape this. We're going to introduce a new tool to help us with this called a Home Equity Line of Credit (HELOC)

A HELOC is different than a traditional mortgage in several ways. The two main things to remember are (1) a HELOC is a revolving line of credit - which means you have the ability to pay back and re-use any available limit of the HELOC; and (2) a HELOC uses average daily interest calculation (simple interest) instead of an amortization interest calculation which is used by your 30-year mortgage. There's a common myth out there saying that HELOC interest rates are always variable and higher. This isn't true... There are HELOCs out there with fixed interests rate and some even have lower interest rates.

Now, in 2021 - the best version of this strategy (in my opinion) is to use a 1st lien HELOC to completely replace your mortgage. By doing this, we now only have one debt against your home. No more 30 year amortized mortgage! Just a 1st lien HELOC. With the 1st lien HELOC, you're now able to deposit all of your income (and event savings) into the HELOC balance to reduce the average daily balance - which ultimately means a lower interest amount you'll pay on a daily basis.

https://www.youtube.com/watch?v=tFSRd_ZQx84