Leveraging the velocity banking strategy is one of the most remarkable ways to ensure you pay off your debt or mortgage within the shortest time possible. While the steps to implementing the velocity banking process might seem straightforward, the process can surely get complicated and unmanageable in the event your financial circumstances change.
If this is not enough, there is also a greater risk to your financial security when you choose to use debt to pay back another debt. In short, when it comes to paying off a mortgage faster, is to make higher payments than the minimum required. There are numerous ways to go about this, and velocity banking is merely one strategy.
Bear in mind paying off your mortgage early is not necessarily the golden ticket to achieving financial freedom. When you stick to regular payments over 30 years, you’ll definitely have more cash flow to apply toward other debt, investments, retirement funds, and college tuition, to mention a few. For this reason, you should determine your priorities and money values, after which you should align your financial goals with them.
Counting on HELOC to pay down your mortgage is simply getting an interest-accruing loan to pay down another interest-accruing loan. This adds another interest-expense component to your overall financial structure, which has the potential to be a burden rather than a benefit if the strategy isn’t carried out effectively.
Transferring debt can be a remarkable way to save money if all moving parts are working in your favor. You should determine if you have the capacity and discipline to stick to the process for an extended period of time. Furthermore, you must bear the risks involved without becoming overwhelmed.
To cut a long story short, the velocity banking concept is centered on lowering interest costs. This strategy allows users to accelerate payments to their mortgage principal, thus lowering the interest portion of their loan. Ensure you do your homework to better understand what the velocity banking strategy is all about before you can finally take the next step of action.
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