Financial Equalization-The Mortgage Killer

Why Does It Work?

In order to understand the Financial Equalization concept, you must first understand exactly what a mortgage is and how it works; what the financial principles involved are, and how they are applied. In short, identify the problem(s), define the results you want to achieve, and finally, find the weak links in the mortgage amortization chain.

1. A mortgage is an installment loan just the same as a car loan or a personal loan.

2. Installment loans are front-end loaded, the majority of the interest cost is collected by the lender upfront.

3. The loan payment is based on the initial amount of the loan and the interest charges on this amount are attached according to the terms of the loan.

4. The longer the time period (term) involved, the greater the increase in the amount of interest payable.

5. On a mortgage loan, since the time period is long-term and the interest is payable upfront, the result is that in excess of 90% of each mortgage payment in the early years is interest costs. These costs decrease very gradually until the loan is repaid.

6. Since the interest costs are added to the initial amount borrowed, this also means that no matter how small your outstanding balance becomes over the years, you are paying interest on the original amount borrowed.

Example: You borrow $100,000 for 25 years @ 9% with a monthly payment of $828. After 15 years of payments you will have paid out $149,040 principal and interest, and you will still owe $65,822. Your payment on this balance will still be $828 per month, the same as if you still owed the original $100,000.

7. Time is your enemy on a mortgage loan, much more so than interest rates.     For the lender MORE TIME = MORE PROFIT!

8. Three things must happen in order for you, the borrower, To gain a financial advantage in this situation:

    a. Time must become the borrower's ally, not the lender's.
    b. A way must be found to increase the efficiency of the principal reduction portion of each payment. And,
    c. The weak link in the mortgage amortization chain must be found and used to the borrower's advantage.

FINANCIAL EQUALIZATION - makes these three things happen. It is safe, easy and it works! It allows you to save thousands of dollars in interest charges, save years of payments, and most importantly, accomplish these savings without any increase in debt payment obligations.

FINANCIAL EQUALIZATION is not too good to be true. It is simply a concept that utilizes the whole truth. Financial institutions are in business to make a profit as much as possible. They are not obligated to tell you how to decrease the profit-ability of their business. If you were in business as a lender, would you?

FINANCIAL EQUALIZATION IS SAFE, EASY AND IT WORKS!