How To Pay Off Your Mortgage Early and Save $10,000 – $100,000

Hi In this video I'm going to show you how to get your mortgage paid off early and save tens of thousands of dollars so you have a nest egg for your retirement or just a lot of extra money and I'm going to show you how to do this with the help of the Federal Government

My name is Lance Mohr and I'm a real estate agent in Tampa Bay Florida and the reason why I'm doing this video is because over the last 10 years I've seen more people have less equity in their homes and I'm getting sick of banks and so-called professionals taking advantage of people just because they want to make money and not doing the right thing in helping people out the one thing I'm going to ask from you is if you know anybody who owns a home; family members, friends, co-workers – please share this video with them don't assume they know when I'm going to go over in this video and are doing it over the past 20 years is a mortgage banker in a realtor virtually no one knows about this and even fewer people do it so you can help a lot of people by sharing this video with them alright everyone so before we get in and go over my real estate equity blueprint I want to go over something I think is very important to everybody watching this every homeowner a future homeowner and that is why so many people do not have a lot of equity in their home or money in their home when they get older or even now when they're younger and a lot of it has to do is understanding the statistics so statistically the average homeowner purchases a home every eight years they refinance their home every five years so what most people do and this is from me dealing with thousands of homebuyers both as a lender and a real estate agent they buy a home they put it on a 30-year mortgage they live in it for five years statistically then they refinance they put it back thirty-year mortgage they live in it three years then they buy it they sell it then they buy another home they put that one on a 30-year mortgage they live in it five years they refinance it back to a 30-year mortgage then the cycle continues now it may not be like this statistically it may not be for for everybody eight and five years but these are the numbers when I was in lending I probably refused about 25 or didn't do 25 to 33 percent of all my refinances and the reason is because it just did not behoove two people to do that I would have people come in to me and they would want to refinance because they're saving money or you know maybe the interest rate lowered or whatever and they refinanced and they've been paying on their mortgage for eight years and they want to refinance it back to a 30-year mortgage I'm like why would you do that what what are you going to do just throw those 96 or hundred payments out the windows so I did I did a refinance video I'll put the link above and if you're thinking about refinancing or want to know more about this you could watch it but if you look at banks out there they really understand this they know how mortgages work they send letters in the mail all the time refinance your home no cost zero closing costs to refinance they do this all the time because they just want to keep you like the gerbil on the treadmill going around and around and around and unfortunately most loan officers aren't given people good advice either one of two reasons they either are just doing it because they want to make a buck or they don't really understand how a basic mortgage works now sure the bank they don't care about us they don't care about any of us they just want to make a dollar and you can expect out from them so if you're not really sure check out that video I'll put it above now let's get into what I consider one of my favorite parts of homeownership and that's tax write-offs so I love tax write-offs I always have when I bought my home at 23 years old the first thing I did was went to an accountant now one get the scoop on what was going on and being self-employed I have to know it so I want to just state right up front consult an accountant your CPA I'm not an accountant I'm not a CPA I'm not giving you tax advice here this is just common sense we're going to run through some stuff right here that a lot of you and most of you may already know but we're going to put a different spin on things a little bit so you could save a lot of money so let's start often we're going to use the loan amount of $210,000 an interest rate of 425 percent with the principal and interest being one thousand thirty three dollars and seven cents now I understand your loan amount your interest rate your property taxes you pay even your you know even the you know what tax bracket you're in may be all different and that's okay just go with me on this so based on these figures the interest paid for the first year is eight thousand eight hundred and fifty six dollars that's the interest majority's interest it's not principal the property taxes paid are three thousand four hundred and sixty three dollars so this is property taxes right here so you have a total tax write-offs on the interest paid on the loan of eighty eight fifty six and then the property taxes paid in the property of 3463 your total is twelve thousand three hundred and nineteen dollars now that's your tax write-off that's what you would be right enough so if we looked at this and we said okay well you're in the twenty five percent tax bracket which is a pretty common tax bracket out there it's a federal tax bracket so I'm talking so you're right offs would be it's basically like the government if you didn't do anything with the exemptions it's like they would give you a check at the end of the year for three thousand and eighty dollars so if you broke that down into a monthly savings it would be two hundred and fifty $665 it's called twelve payments a year so it's a substantial savings so what's going to let's go over and we're going to go over the real estate boyfriend so of course the goal is to pay your home off in full early saving thousands of dollars and I'm going to go through this pretty quick I'm not going to read everything – yeah I'm going to tell you when buying home pick in your real estate agent picking your own officer is critical is critical to the process a lot of times people you know always look at price price price but it's not the price it's the cost people make money because cost not price so let's go through this I'm going to show you how you pretty much save around ten thousand to a hundred thousand dollars and put it in your pocket not the bank's pocket and I'm going to be going quick but I want to make sure you understand all this so let's just go over a couple simple facts for you first we're borrowing two hundred and ten thousand dollars at four and a quarter percent so basically doing that you're going to pay the bank a hundred and sixty one thousand nine hundred and six dollars in interest so in other words you're borrowing two hundred ten thousand you're going to pay them three hundred and seventy one thousand nine hundred and six dollars Wow after paying your mortgage for ten years making a hundred and twenty payments you're going to still owe almost 80% of what you borrowed the total amount that you'll pay in ten years is almost a hundred and twenty four thousand dollars out of that one hundred and twenty four thousand dollars only thirteen only forty three thousand one hundred and sixty nine dollars has gone to reduce your principal the rest went to pay your interest so after ten years of making payments of a hundred twenty three thousand nine hundred and sixty eight dollars only twenty percent or so is going to your principal to pay off pay off your mortgage after fifteen years you're still owe about sixty five percent of what you borrowed alright so it's good to really understand those numbers so let's start off and just get into the basis basic mortgage 210 and four and a quarter percent you're basically not saving any money this is what most people do right here now it used to be a little bit more popular than it is now but a lot of times people say hey let's buy down the interest rate let's instead of four and a quarter let's buy it down to 4% and sometimes builders may even offer this and that's great well doing this you're going to save ten thousand nine hundred and eighty dollars and that's good because it's going to take your payment down to instead of a 1033 it's going to take it down to one thousand and two but let's say you did the buy down to four percent and you took the savings of thirty dollars and fifty cents and then you just added that toward your principal every month so instead of paying one thousand to two dollars you pay one thousand and thirty three like you would do it four and a quarter percent would you do that that option right there saves you over thirty years twenty thousand five hundred and eleven dollars so you can see that's a pretty huge savings but nothing compared to what we're going to get into so what we want to do is let's go over the real estate equity blueprint there's three options that I'm going to show you the first right here is called a bi-weekly payment now basically what a bi-weekly payment is is it's making a payment every two weeks so you're basically going to take your mortgage and divide it in half and then you're going to make a payment every two weeks so essentially you're making thirteen payments a year instead of twelve most people could do this and it's and it's really going to help it's basically so if you make five hundred and sixteen dollars and fifty force entertainment every two weeks for three hundred and nine payments so you're not going to be making 360 you'd do it for three hundred nine payments you'll be saving twenty six thousand four hundred fifty five dollars by doing that two really big savings now let's over here now if you work right here remember when we were right here and I said okay your monthly savings is two hundred fifty six dollars and sixty-five cents for 12 well let's go a little bit more with this over thirteen payments this is what your savings is two hundred thirty six dollars and ninety two cents but if you made twenty six payments per year all right well your savings would be a hundred and eighteen dollars I say savings the government's basically giving you a hundred and eighteen dollars twenty six times a year so what say you took that hundred and eighteen dollars and you put it back into your bi-weekly payment so you take the 516 out 118 it's 634 so now you pay $634 fifty four cents every two weeks now keep in mind this 118 this was like many Uncle Sam's given you so why not do it now also I'm just talking about if you own the home as your primary residence if you're an investor I'm not even getting into the depreciation what 1031 exchanges are I mean that's like game on when you're an investor that's why the goldstone investment properties if you can or if you want to but we're just talking about a primary residence here of course this will work the same way whether you own a 15-year more but if you have a 15 year mortgage whether it's it's a rental property if it's a rental property you'll even have more savings so you're going to if you do this you're basically you're now going to be done paying off your mortgage effort after only 220 months instead of 360 so you're basically eliminating by doing this what the government's given you keep in mind you're doing the by bi-weekly but the 118 the government's like giving you that money why not use it for something instead of put it in your savings account or spending it so you're going to be debt free on your mortgage in under nine teen years instead of 30 you'll be saving almost $70,000 in interest in in payments now this is good this is strong but most people in calculating and looking at tons and tons of people's financials over the years could if they really wanted to cut out maybe some restaurants every week cut out some Starbucks every week save a little bit more money so instead of let's see instead of doing 118 dollars which the government's basically giving you assuming in your tax bracket your CPA can forgive this let's do $300 okay this is where it really gets interested so instead of 516 dollars every two weeks you pay an extra three hundred dollars now you're going to have to make a sacrifice doing this no question but it's going to really pay off long term okay so your bi-weekly payment is 816 dollars again this is only principal and interest but doing this you're going to eliminate 206 months of payments and you're going to be debt free and under 13 years instead of 30 in saving almost hundred thousand dollars saving ninety nine thousand two hundred and thirty five dollars in interest in payment that's insane so let's go over an overview sort of a recap again the main thing a lot of people are doing is the first option is just a standard mortgage thirty-year mortgage you're not saving anything you do a quarter percent buy down in this case you're saving a little over ten thousand dollars if you do the buy down and reinvest that money the $3050 you're going to shave off a little time you're going to save you're going to save you know twenty thousand dollars if you do a biweekly mortgage you're basically going to save twenty six thousand dollars but if you do a biweekly and just give back in this case what the government's given you one hundred and eighteen dollars you're going to save almost seventy thousand dollars and if you could just add instead of a hundred eighteen dollars just add a little bit more of your own money cut some expenses somewhere and add three hundred dollars in an extra payment you're going to save almost a hundred thousand dollars in savings so instead of pain you know three hundred and seventy one thousand dollars over thirty years you're going to be only going to pay two hundred and seventy two about thousand dollars so instead of paying total interest of one hundred and sixty one thousand you're basically sent into sixty two thousand it's insane and your payment off in thirteen years or nineteen years and this is hopefully hopefully you know you could do one of these I know if you're in a fixed income bracket then it does get a little trickier but you could still do it talk to your accountant and tell them you know and have them talk to you about different options because it is an option now I hope you enjoyed this educational video and found it enlightening and please don't forget to share this video with anybody you know that owns a home if I could help you in the Tampa Bay area find a pre-owned home a new home or sell a home please contact me I'm a knowledgeable experienced an aggressive realtor that's always going to look out for your best interest thank you for watching this video thank you for watching my youtube channel and if you do like this video please comment below and let me know your thoughts have a wonderful day you

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