Providing a Pro-active Road-Map For Equity Growth

We suggest you print this section

Proactive Approach to Managing Your Mortgage
Managing your mortgage is a simple means of controlling the amount of interest you actually pay versus the amount you are scheduled to pay. You decide the amount, the starting time and the stopping time. You are always in complete control.

There are two steps in understanding the road-map:

1) determining the monthly amount you are comfortable in paying toward your own equity’s growth. For this example we will use an arbitrary figure of $97 monthly to show the power of prepaying.

2) the second part is a tool for you to track the effects of your pro-active equity build-up.

Step 1 of Example: Step 1 The graph on the top represents the typical borrower. The graph on the bottom demonstrates the proactive results of a borrower prepaying $97 monthly using the PowerPlus. In this example the monthly prepayment of $97 helps pay off the mortgage approximately six (6) years earlier and saving yourself $40,603.47 in interest payments. Remember, the greater the amount of prepayment, the greater the interest savings.

Once you review this graph, we urge you to access the mortgage calculator and insert the mortgage numbers that best fit your specific situation. You will create a graph like the ones below that are customized for you!

Step 2 of Example: Review the table below, based on our $97 prepayment example. The left half of the graphic shows how the typical borrower’s loan amortizes. The right half of the graphic shows the impact of a proactive, $97 monthly prepayment.

Focus on the principal balances at the end of year five. The balance difference of $139,581.24 vs. $132,813.57 is significant. Now look at year ten. As time progresses, both the yearly interest savings and the equity growth are even more significant.

One you review this graph, we urge you to access the mortgage calculator and insert the mortgage numbers that best fit your specific situation. You will create a chart like the one below that is customized for you!

If you need assistance you can email a request to: jbayer@firstintegrity.com (in subject please type: prepayments)