Mortgage Mayhem Madness and Do I Need Software?

I received another call this week about mortgage acceleration software. The question is always the same: "Do I need software to help me use a home equity line of credit (HELOC) to accelerate payback on my mortgage?"

The frequency of these calls and the number of websites dealing with the same question show that regardless of the mortgage rule tightening and the foreclosures reported in the daily news, lots of people are still paying off their homes, and not only getting it done, but speeding up the process, using the "velocity of money" we talked about in our last blog, to save themselves a bundle on mortgage interest.

In other words, the doom and gloom reporting is madness.

About a third of homes are already paid for.

Thousands more people are paying their mortgages off sooner rather than later. So back to the original question: Do you need special software to speed up your mortgage payoff? Kevin told me he'd seen the Money Merge Account presentation by a friend of his who is a United First Financial agent. He'd asked a lot of questions and figured he'd caught the sales rep revealing a little too much - so much so that Kevin was pretty sure he could use a HELOC on his own without buying the software.

That's when he called me. I love these calls. (My toll free number is 888 664-6651.) But they all run pretty much the same way. I should record them and play back the recording for the next person who calls.

If you have a very fancy mirror, say a gold framed mirror (real gold plated, not gold painted), and you look into it, will your hair look any better than if you were looking into your regular bathroom mirror? All else aside, your hair is still going to be your hair. It isn't going to groom itself just because you change the mirror!

I asked Kevin some friendly questions about his home and his loans. Then I asked whether he needed to know the exact date and time his mortgage would be paid off. He said, "No," so I said "No." If he didn't need to know exactly when his home near Sacramento would be paid for, he didn't need special software.

I've talked to users of special software and agents selling software for as much as $3500 and their numbers are not substantially better than my own. In fact their numbers are not always better or worse, but they are always close. Believing financial software is going to make you rich is like believing word processing software is going to make you a writer.

However, listening to Kevin describe how he thought he should move his money from here to there did reveal he needed help. He needed a step by step plan.

You can pay off your home years sooner, often in about a third the time of a conventional loan, but you need to know how. The basis of success in doing so is spending less than you bring in. To capitalize on the velocity of money, you can also employ a HELOC to work on your behalf, or a personal line of credit if that's the best you can get.

However, you do need to know what you're doing or you could end up deeper in debt than when you began - instead of closer to financial freedom. Check out sources of information for a game plan to own your home years sooner.

In my next blog, I'll talk about why mortgage acceleration software might be a bad thing.