It seems that every time you hop on the internet these days you see ads with the following types of headlines:
“Own your home outright in 3 years”
“Be mortgage free in 7 years”
“Pay off your home in 10 years and own 10 properties”
“How an unemployed bum went from the couch to being worth $2.3m in 24 months”
or some other similar type of claim.
We frequently get asked whether any of these are really achievable. Well, the answer to this is yes and no, but predominantly no, particularly an unemployed person going from the couch to millionaire in 24 months from property. I can’t believe people believe this stuff but they must, because almost every week there’s another similar claim in another ad.
A very select few will be able to wipe out their mortgage in under 5 years, while others won’t have the slightest chance in getting anywhere near it. There are so many factors involved with achieving this feat and not everyone is in a position to become totally mortgage free in this period of time.
Firstly, your mortgage balance, income levels and ongoing monthly expenses are going to heavily determine whether you’ll be able to achieve such a goal. A professional couple, with a relatively modest mortgage and high disposable income are obviously going to have a far greater chance of achieving this objective than a couple with a young, growing family and one source of income.
Sorry not to have the “magic solution” to solve one of society’s greatest financial objectives, however I do have some good news that’s applicable to everyone grinding away at a mortgage debt.
“We can all immediately implement strategies that will help us shave years of our mortgage term and in the process save ‘000’s of dollars in interest”
Prior to sharing these strategies with you I just need to make a public announcement:
WARNING: Don’t believe the hype of certain property marketers it can be very detrimental to your financial health!
I’ve been running my Finance Broking business in excess of 20 years now and during this period of time I’ve heard and seen all the different strategies that have been marketed over the years.
When I hear about a strategy, I invest time and resources in researching whether that strategy is legitimate and whether it can benefit me personally and as an extension of that…my clients.
If the strategy is legitimate and I’m able to apply it to my own personal financial situation then we’re quite happy to recommend it to our client base…if it’s relevant to their personal financial situation!
At the end of the day our firm generates it’s revenue from assisting our clients in obtaining finance, for either their business or personal use, and in the process assisting them in creating wealth…so if it’s a valid and legal strategy we will recommend it.
Be very aware of this strategy!!
There’s a favourite strategy of certain property investment spruikers that’s been doing the rounds over the past decade and tends to be the backbone of what many promoters are claiming will allow most everyone to pay off their mortgage in 5yrs or less.
This strategy involves purchasing an investment property (usually one that they happen to be selling), capitalising the investment loan interest and the investment property expenses, while using all of the rental income to reduce your residential mortgage balance.
Sounds fantastic doesn’t it? Your tax deductible loan is increasing on a daily basis while your non-deductible debt is decreasing just as quick! Unfortunately the ATO is not a big fan of these arrangements and the tax law is still very murky.
If the ATO is not keen on a structure or an arrangement, then you’re best to avoid it. I can assure you that you don’t want a fight with the ATO. You don’t win even if you win..if that makes sense!
Sure, your friends who have this structure in place may have lodged their tax returns and received the full refund but it’s only a matter of time before they’re flagged on the ATO computer and they receives a tap on the shoulder for a “friendly” audit.
Rest assured that the moment the ATO gives this type of arrangement the green light, if it ever does (which I doubt will ever happen), we will be in contact with you – that’s if you’re on our database. If you’re not on our database, you can sign up by clicking here.
How to get to that state of Nirvana known as “mortgage free” living!
Now that I’ve given you the heads up, let me start detailing the strategies that will help you legally become “mortgage free” in the shortest period of time and in the process save you a fortune in interest.
Once you get to this stage your biggest problems you’ll have will be deciding where to take your next holiday to or recovering from your last one! And all this can be achieved well before retirement age with a little focus.
All that’s required is the correct mortgage structure, the implementation of a few simple strategies, the right attitude and then sit back and watch your mortgage balance drop quickly…it’s really that easy!
Before we get into the various strategies, it’s important to ascertain where you’re at financially as this will determine what strategies can be implemented immediately.
There are 2 stages to an effective mortgage elimination strategy and it’ll depend on your financial position as to what stage you can commence at.
Read Part 2 tomorrow to ascertain what stage you’re currently at and what strategy you’ll need to implement to get things moving.
Contact us now if you would like to find out more now.
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