With all the talk lately about Mortgage Cycling versus
Bi-Weekly Mortgages which one is really right for you? Choosing the correct
one could literally save you thousands of dollars and shave off approximately
20 years on the life of your 30 year mortgage.
Reducing your mortgage
and save $1000's.
So a little background on the principal of each program needs to
be told. Bi-weekly mortgages became popular a few years back when
interest rates were extremely high and it made a lot of sense to
pay as much on the principal of your mortgage as you can in a systematic
The way it works is that your mortgage payments are split in
two every month so you end up paying (26) 1/2 payments instead
of 12 whole payments which in effect ends up paying one additional
month towards your principal.
Doing this ends up saving the average homeowner thousands of
dollars on the interest payments over 30 years and shaves off
around 7 years of payments. Not bad for back then. But as interest
rates started to drop the net effect of savings are not as great
now as they were when rates were higher.
But with the discovery of a recent mortgage loophole by Craig
Romero, a senior mortgage analyst, Mortgage Cycling was born.
Mortgage cycling allows a homeowner to build up 10 times faster
then biweekly mortgages and allows you to pay of your 30 year
mortgage in 10 years or less.
Mortgage cycling | mortgage refinancing.
Mortgage cycling allows a homeowner to build up equity in their home fast
using a patent pending technique. So fast that it ends up paying off a
traditional 30 year mortgage in just about 10 years.
At first I was skeptical on how powerful mortgage cycling is until
I compared using a typical $150,000 loan for thirty years at 7% interest.
After running the figures though the difference between a bi-weekly
mortgage versus mortgage cycling is dramatic.
Bi-weekly Mortgage Cycling
- Equity 1 year $1,520 $14,061
- Equity 3 years $4,900 $44,972
- Equity 5 years $8,787 $74,179
- Equity 9 years $18,397 $136,429
No matter the loan amount, interest rates or mortgage term, mortgage
cycling showed to dramatically cut down the payment time and interest
payments to your mortgage company over the life of the loan.
Imagine what you could do with all that extra money that you can put
back in your pocket instead of your mortgage company.
Now mortgage cycling may not be for everyone. But for someone who has
the discipline it can be a very effective way of building up the equity
in your home and to pay it off extremely fast versus using a standard