What is a Florida Mortgage Accelerator Payment?

Homeowners, understandable, have numerous questions. Such an important, expensive process results in many individuals doing whatever they can to save as much money as they can on their Florida mortgage.

With that in mind, are you familiar with a mortgage accelerator payment? Some insiders/salespeople try to persuade owners from using one of these on a Florida home equity loan or HELOC?

For example, a curious buyer wrote into Don Taylor, a financial advisor, and said he was three years into 30-year fixed rate loan at 5.125 percent. He pays an extra $250/month toward the principal - but was told that he could forgo the extra payment and use a flexible line of credit to pay off his mortgage in seven years with this program.

Is it a legitimate deal? Here’s the paraphrased response to such a query.

It’s rare for a mortgage accelerator program to be tied a home equity loan or line of credit. A mortgage accelerator program is normally defined as a biweekly Florida mortgage. Taylor is not a fan of biweekly mortgages, largely because you can accomplish the same feat on your own by making additional principal payments. .

Assuming there are no contractual provisions against it, such as a prepayment penalty, you can use the proceeds of a home equity loan or line to prepay your first mortgage, but why, especially in the current Florida mortgage rate environment, would you want to do that?

The above scenario is an example of an amazing interest rate on a house. The buyer can afford to make additional principal payments each month, so he didn’t buy too much. Why do financial handsprings to improve on perfection?

It’s possible, based on one’s income, age and financial goals that it may actually make more financial sense for you to stop making additional principal payments and invest the money instead toward those other financial goals. Complete the COST-FREE form atop this page to discuss Florida home mortgage refinancing options more with a broker.