CMG Mortgage has reported that the accelerator loan has seen its popularity double in 2007 even as sales of traditional loan products have collapsed. The new loan is modeled on a popular Australian home loan program called the ‘all-in-one’ loan that has a proven record of helping borrowers pay off their home loans years faster and save them thousands of dollars in interest payments.
This home financing tool works by combining a home loan and a full-service checking account. This innovation can produce large interest savings and loan payoffs in as little as half the time without changing the borrower’s spending habits. This product is timely because a large group of Americans, especially baby boomers, are realizing that they must stop extracting home equity and build it back up if they want to retire mortgage-free.
Homeowners can access their funds to pay expenses just like they would with a checking account, using the unlimited checks, ATM/Visa point-of-sale card, and free online bill-pay that come with the account. While the homeowner’s funds are not being used, they keep the principal balance lower, thereby saving interest.
Chris George, president and CEO of CMG Financial Services, the parent company for CMG Mortgage, said: People can no longer count on appreciating home values to build equity, so they need a new solution. The accelerator provides it, building equity faster by accelerating the reduction of debt.
