Suze Orman Approves Mortgage Accelerators To Pay Off Mortgage

Suze Orman Approves Mortgage Accelerators To Pay Off Mortgage

Suze Orman says that people who advise against paying off a mortgage early are wrong. In an NBC interview with Ann Curry, Suze Orman debunks the idea that paying off a mortgage early is a mistake. She counsels that for most people their home is their number one priority and should be protected against the risk of carrying a mortgage into senior years.

Suze Orman points out that for a $200,000 mortgage that requires a monthly payment of $1,200, the homeowner would need about $400,000 in their 401K plan to generate that much money, assuming it earns 6 percent, which is reasonable. Suze points out that the stock market is erratic, as we all know. Because of this, a homeowner carrying a $200,000 mortgage may not be able to generate enough interest in their 401K to pay the mortgage each month if their stock portfolio drops.

Suze orman says that maintaining a mortgage while investing in the stock market is too much of a risk. She also points out that most poeple only stay in a home for seven years and that mortgages are front loaded with interest, so that after 20 years, more than half of the original mortgage balance still remains due; and because most of the interest is paid in the early years, there are little or no tax write offs in the last 10 years.

In the interview, Suze says that making extra payments or paying more each month will reduce the mortgage by five years or so. Generally, whatever the amount, she says that people should pay off their mortgage as soon as possible and before investing in their retirement accounts.

All homeowners should follow this advice to pay off their mortgages quickly. The fastest way to pay down a mortgage is with a mortgage accelerator. Mortgage accelerators are little known in the United States but have been used around the world for many years. The average homeowner can pay off their 30 year conventional mortgage in as little as 10 years using a mortgage accelerator.

Mortgage accelerators are very effective but relatively few people know about them in America, where mortgage finance is not taught in school. If more people knew how powerful mortgage accelerators are, virtually every homeowner would use them.

Another advantage of using mortgage accelerator is that they save time in the homeower's peak earning years. This allows the homeowner to pay off their mortgage in about 10 years, and then apply their money to their retirement account because they are no longer encumbered with monthly mortgage payments.

Using a mortgage accelerator in this type of financial plan, many homeowners will be able to accumulate a retirement nest egg in the vicinity of one million dollars. This is due to the fact that they will be making large monthly contributions to their retirement accounts and the money will have many more years over which to grow. It is a certainty that if people followed Suze Orman's advice and used a mortgage accelerator, many more people would be able to retire comfortably.

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