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Should really You Shell out Off Your Property finance loan Early with a HELOC?



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You can use the fairness in your property to get a property fairness line of credit. Subsequently, you can use the money to pay out of your mortgage early whilst then working with the HELOC as a examining account. This arrangement will enable all money that you have to not sit in an account to master very low or no total of desire. Of system, doing so has some down sides. View to online video to see what they are.

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29 comments

  1. WARNING: This video is meant as a review of a financial tactic that is often talked about. I do not say at any point that everyone should do this and I do not even do this myself. This is more about learning of different methods be it good or bad.

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  2. What do you think about paying off high interest credit card debt with HELOC?

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  3. What i did was replaced my mortgage into a HELOC first year and my principle is down to 23k the year before that i had a regular mortgage and the principle was only down to 2900k what a difference. it does take discipline and budgeting but its well worth it plus the available funds can be use as an emergency fund or you can use it to invest in real estate which that's what i did.

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  4. Does it have to be a HELOC? Can't you use a Credit Card?

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  5. I still don’t get it. What’s the difference when you just put the money from your checking and savings directly to your mortgage. Why do you have to use heloc?

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  6. Take out a loan to pay off an existing loan (mortgage) on your house? Fucking stupid.

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  7. Same here, good video, but it was to fast for me to interpret exactly why I need to do this.

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  8. This month I took HELOC and paid off my 170k mortgage. I calculated 21 months to pay off mortgage if I really watch it and 30 months if I enjoy myself and withdraw more from HELOC.

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  9. Just dont take a loan. Rent a house.

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  10. banks will not let you get the loan to use on mortgage payoff

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  11. I have the extra income to just save 10k then pay towards principle then repeat. Why wouldn’t this work just as fast? The only difference that I see, is that I have to save first but without the risk of getting in a financial bind associated with a heloc. Should I have an income issue, I would have some savings. This just seems like a forced commitment.

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  12. Aren't you essentially swapping a low fixed rate for a higher variable rate? The only way the math works is if you put all your idle cash into the HELOC, but not the mortgage. Why are you creating an extra step with risk? Why wouldn't you just put the idle cash towards the mortgage?

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  13. Thanks for this video. I'm going to do this.

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  14. I don't understand why in this age of super low mortgage interest rates that people want to pay even $1 extra on their mortgage! Take that money and invest it! Get a 30 year mortgage and don't pay any extra. My stock dividends make my mortgage payment. This is stock I wouldn't have if I threw all my extra money at my Mortgage…Read more Show less Reply

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  15. !!WARNING!! MUST READ!! WARNING!!

    Dear BeatTheBush and anyone who may read this comment. I am a California Realtor and licensed Loan Originator which means I negotiate loans like HELOC'S and other types of loans for clients all the time. Mr BeatTheBush you may be well intentioned trying to inform your audience on different financial tactics to take advantage but this is a video poorly informs your audience and in matter of fact could harm so many people.

    You titled the video "Should You Pay Off Your Mortgage Early with a HELOC?" yet you never answered the question. I'll answer it for you, NOOOOOOO!!! It's a horrendous idea and tactic that was construed by people who work in my industry so they can get a commission off of you. I do not like to take advantage of people and always work with basic integrity. I help my clients make money so they can invest more and more, which will help give me more work. Some people in my industry are leeches and create bad financial tactics to trick good people into making more loans so Loan Originators can get more commission.

    You properly informed the viewer about the pros and the cons very well. The problem is that for most people it will be confusing and difficult to understand because the majority of people don't make loans often. The problem I have with this video is that you are portraying this financial tactic as if it could be beneficial for people yet you even said that in the best scenario you break even and the worst scenario you get stuck with a balloon payment or end up paying way more than you would have with the mortgage. (That is how you should explain it to people, not in a complicated manner that only a person that works in my industry or someone who deals with loans constantly would understand)

    I apologize if I sounded harsh Mr BeatTheBush but I dislike most of my peers who work with me in the this industry because all they care about is the commission. I believe that If I work with integrity and give good advice I'll help people make and save money which in turn they'll invest more and provide me with more work which is my business strategy. It also makes me feel proud of my work. Sadly I know for a fact that this financial ploy was pushed forth by people who work in my industry and should be stopped since it usually leads to foreclosure. This only benefits the Loan Originators and Lenders, not the home owners.

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  16. This only works if you have positive cashflow.

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  17. Interesting. In the UK and Australia, they have "offset accounts" – see wikipedia.org/wiki/Offset_loan_(finance) . The balance in the linked savings account offsets the loan balance, when calculating interest. Usually comes in a package also with a credit card to manage cashflows. So much simpler than HELOCs.

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  18. Do you know of anyone personally that has done this and it worked like it does on paper?

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  19. good info

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  20. "The magic works where when you have cash sitting in your checking" This is innumeracy. All you are really doing is pre-paying the mortgage, but with the unnecessary, costly, and stupid step of borrowing from the HELOC first. Mortgage and interest and HELOC interest are calculated virtually the same way (mortgage interest is calculated at the first of the month, HELOC interest is the average monthly balance). Over long periods of time and high dollar figures they are essentially identical. So by taking out a higher interest loan, you are paying more over time. Not less. You can easily prove this in Excel. This is a dumb, dumb, dumb financial technique.

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  21. I am at a point in my life NOW where I can save and drop 24k every January to my 200k mortgage which I've been paying for the last "8 years" with "no extra payments".. I owe 167k and the mortgage calculator has me paid in full FEB of 2023 at a total of around 84k in interest… Would it make any sense to use this HELOC method at this point or just go with my current plan of 24k/year toward principle..? basically cutting my 30 year mortgage down to 13years..

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  22. When you take out the HELOC to pay off your mortgage you basically take out a second ARM mortgage… OK

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  23. You can also get a fixed rate heloc. Usually a little more than variable rate but worth it if you get it while rates are low

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  24. Thanks for busting many of the myths that people have been posting on YouTube about this tactic. It seems that the better option would be draw from a pool of unused and not crticial savings depending the rates rather that may go up and in the long run not make sense.

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  25. I love your videos, man. Honest and unbiased.

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  26. is this applicable in every country like Philipines? Is this offered in bank? how do we get this?

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  27. These are the types of tactics that cause bubbles. ADJUSTABLE RATES are not predictable and fluctuate depending on the amount of risk the market is taking. That is the more people that do this the more unstable the HELOC rate will be.

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  28. I am confused, how is taking a 5% loan to pay for 4% loan makes sense? Maybe you did not explain it right))

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  29. Now you would be making 2 payments instead of one. The fed will make 3 rate hikes this year. Stupid !

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