I hear commercials about eliminating mortgage and debt in a few years. Any advise as to whether this is true?

Answer 1

You cannot eliminate debt without paying it off, or going bankrupt. You can't pay it off any faster than you can earn money to do so. All these schemes are variations on scams. They'll promise to get your credit card companies to forgive debt or lower interest rates; to get you into an excelerated mortgage; and other items that are unlikely or difficult to do.

Build a good budget, control your debt accumulation, reduce discretionary spending (on things like cable, cell phones, cars etc) and pay off your debt as fast as possible.

What the MMA is offering is a way to help you do this, but at a price - you end up with yet another high interest loan (HELOC). See this article, especially the downside, of this approach:

http://en.wikipedia.org/wiki/Money_merge_account

If you want to pay your mortgage off quickly, just pay a $100 a month extra to the mortgage company, telling them it is a payment 'against principal'. This will reduce a 30 year mortgage to about 22 years. Paying more than $100 a month will obviously reduce the mortgage term even further.

Answer 2

You don't say where you live but in the UK we have a company that promises to reduce debt in a similar way, they use an offset system, basicaly say you have £1000 saved and £2000 debt your interest rate could be 30% of £2000 making it £600 a year but by banking that £1000 you wouldn't pay the interest on that amount of money so,

£2000 (debt) - £1000 (savings) = 30% of £1000 or £300 a yr

This sort of dept help is only realy usefull if your carfull with your money or have a lot going into you bank a month.

Answer 3

The commercials you are hearing about refers to a certain type of insurance policy. The policy must be carefully set-up and what you do is borrow against your own policy. You still are making payments, but it is to your own policy account and not a bank or lending institution. As you pay back the money you borrowed from your policy it grows and as it grows you borrow more against it, after a period of 5~7 years the policy can be large enough to eliminate your debt to the lending co.'s (NOTE: most insurance companies don't offer this type of policy)

Answer 4

Actually yes is the answer. There is a new MMA program that uses your discretionary funds in a HELOC and you can pay out in just 10 -11 years depending on the equity in your home.
That information is based on a mortgage that you can get at least a 10% HELOC

Answer 5

Sure--if you don't have much debt.