[ucodegen]

@Rustico
I understand that, but in effect the yield on the bill paying money by reducing the interest to be paid on the heloc vs. getting a pittance in checking acct. is a net benefit.

Let me see here.. I take out money at 8+%(cost) interest rate to pay down a 6%(cost) loan at an accelerated rate to avoid carrying money in my checking account at 4%(profit) yield?

Doesn’t make sense. See my notes earlier at paying down the most expensive money first. This is normally the procedure to get out of debt. You don’t want to increase the amount in a more expensive source of money. In the above scenario, you want to pay down the HELOC first and then the mortgage because the HELOC is a more expensive source of money.

[ucodegen]

“The Macquarie Asset Manager loan program has a lifetime interest cap of 21 percent.”

OUCH! on a secured subordinate loan? Thats like a credit card… and a bad one at that.

[ucodegen]

“The Macquarie Asset Manager loan program has a lifetime interest cap of 21 percent.”

OUCH! on a secured subordinate loan? Thats like a credit card… and a bad one at that.

[ucodegen]

“The Macquarie Asset Manager loan program has a lifetime interest cap of 21 percent.”

OUCH! on a secured subordinate loan? Thats like a credit card… and a bad one at that.

[ucodegen]

“The Macquarie Asset Manager loan program has a lifetime interest cap of 21 percent.”

OUCH! on a secured subordinate loan? Thats like a credit card… and a bad one at that.

[ucodegen]

@Rustico
I agree one would be hard pressed to find a heloc that made this work out but it has potential based on the fact that the Heloc is working like a high yield checking account.

HELOCs don’t have a positive yield.. they have a cost. You get charged the interest… it is not paid to you. The interest rate charged on an HELOC is higher than a standard mortgage.

Depending upon the mortgage, most mortgages charge interest on the monthly balance (not biweekly or daily). There are some exceptions. no_such_reality covered how the HELOC works earlier. There are really two issues here; the ‘MMA method’ and the software that supposedly helps you at it. If you use the general technique of paying down the most expensive money(loan) first, you will come out ahead of what this program would do. All this software program does is identify the most expensive money.. for roughly $3500. Amortized over 15 years @ 8%, that is more than $11,000 (this amount is in addition to your other bills so it gets carried to the end). The definition of the most expensive money is the loan that is costing you the most in interest rates and fees, adjusting for taxes.

I’m wait for data still….

[ucodegen]

@Rustico
I agree one would be hard pressed to find a heloc that made this work out but it has potential based on the fact that the Heloc is working like a high yield checking account.

HELOCs don’t have a positive yield.. they have a cost. You get charged the interest… it is not paid to you. The interest rate charged on an HELOC is higher than a standard mortgage.

Depending upon the mortgage, most mortgages charge interest on the monthly balance (not biweekly or daily). There are some exceptions. no_such_reality covered how the HELOC works earlier. There are really two issues here; the ‘MMA method’ and the software that supposedly helps you at it. If you use the general technique of paying down the most expensive money(loan) first, you will come out ahead of what this program would do. All this software program does is identify the most expensive money.. for roughly $3500. Amortized over 15 years @ 8%, that is more than $11,000 (this amount is in addition to your other bills so it gets carried to the end). The definition of the most expensive money is the loan that is costing you the most in interest rates and fees, adjusting for taxes.

I’m wait for data still….

[ucodegen]

@Rustico
I agree one would be hard pressed to find a heloc that made this work out but it has potential based on the fact that the Heloc is working like a high yield checking account.

HELOCs don’t have a positive yield.. they have a cost. You get charged the interest… it is not paid to you. The interest rate charged on an HELOC is higher than a standard mortgage.

Depending upon the mortgage, most mortgages charge interest on the monthly balance (not biweekly or daily). There are some exceptions. no_such_reality covered how the HELOC works earlier. There are really two issues here; the ‘MMA method’ and the software that supposedly helps you at it. If you use the general technique of paying down the most expensive money(loan) first, you will come out ahead of what this program would do. All this software program does is identify the most expensive money.. for roughly $3500. Amortized over 15 years @ 8%, that is more than $11,000 (this amount is in addition to your other bills so it gets carried to the end). The definition of the most expensive money is the loan that is costing you the most in interest rates and fees, adjusting for taxes.

I’m wait for data still….

[ucodegen]

@Rustico
I agree one would be hard pressed to find a heloc that made this work out but it has potential based on the fact that the Heloc is working like a high yield checking account.

HELOCs don’t have a positive yield.. they have a cost. You get charged the interest… it is not paid to you. The interest rate charged on an HELOC is higher than a standard mortgage.

Depending upon the mortgage, most mortgages charge interest on the monthly balance (not biweekly or daily). There are some exceptions. no_such_reality covered how the HELOC works earlier. There are really two issues here; the ‘MMA method’ and the software that supposedly helps you at it. If you use the general technique of paying down the most expensive money(loan) first, you will come out ahead of what this program would do. All this software program does is identify the most expensive money.. for roughly $3500. Amortized over 15 years @ 8%, that is more than $11,000 (this amount is in addition to your other bills so it gets carried to the end). The definition of the most expensive money is the loan that is costing you the most in interest rates and fees, adjusting for taxes.

I’m wait for data still….

[ucodegen]

The law works on ‘nits’ (those nitpickers!!) This may be the clause that states that the refi is a recourse.

580b. No deficiency judgment shall lie in any event after a sale of real property or an estate for years therein for failure of the purchaser to complete his or her contract of sale, or under a deed of trust or mortgage given to the vendor to secure payment of the balance of the purchase price of that real property or estate for years therein, or under a deed of trust or mortgage on a dwelling for not more than four families given to a lender to secure repayment of a loan which was in fact used to pay all or part of the purchase price of that dwelling occupied, entirely or in part, by the purchaser.

The refi is not the purchase. The money is being used to pay off the old loan. The nit being “purchase price” and whether that includes the action of purchasing. Another part might be last paragraph of section 580d. The refi is to secure payments to close out the previous mortgage(secure payment for)

This section does not apply to any deed of trust, mortgage or other lien given to secure the payment of bonds or other evidences of indebtedness authorized .

[ucodegen]

The law works on ‘nits’ (those nitpickers!!) This may be the clause that states that the refi is a recourse.

580b. No deficiency judgment shall lie in any event after a sale of real property or an estate for years therein for failure of the purchaser to complete his or her contract of sale, or under a deed of trust or mortgage given to the vendor to secure payment of the balance of the purchase price of that real property or estate for years therein, or under a deed of trust or mortgage on a dwelling for not more than four families given to a lender to secure repayment of a loan which was in fact used to pay all or part of the purchase price of that dwelling occupied, entirely or in part, by the purchaser.

The refi is not the purchase. The money is being used to pay off the old loan. The nit being “purchase price” and whether that includes the action of purchasing. Another part might be last paragraph of section 580d. The refi is to secure payments to close out the previous mortgage(secure payment for)

This section does not apply to any deed of trust, mortgage or other lien given to secure the payment of bonds or other evidences of indebtedness authorized .

[ucodegen]

The law works on ‘nits’ (those nitpickers!!) This may be the clause that states that the refi is a recourse.

580b. No deficiency judgment shall lie in any event after a sale of real property or an estate for years therein for failure of the purchaser to complete his or her contract of sale, or under a deed of trust or mortgage given to the vendor to secure payment of the balance of the purchase price of that real property or estate for years therein, or under a deed of trust or mortgage on a dwelling for not more than four families given to a lender to secure repayment of a loan which was in fact used to pay all or part of the purchase price of that dwelling occupied, entirely or in part, by the purchaser.

The refi is not the purchase. The money is being used to pay off the old loan. The nit being “purchase price” and whether that includes the action of purchasing. Another part might be last paragraph of section 580d. The refi is to secure payments to close out the previous mortgage(secure payment for)

This section does not apply to any deed of trust, mortgage or other lien given to secure the payment of bonds or other evidences of indebtedness authorized .

[ucodegen]

The law works on ‘nits’ (those nitpickers!!) This may be the clause that states that the refi is a recourse.

580b. No deficiency judgment shall lie in any event after a sale of real property or an estate for years therein for failure of the purchaser to complete his or her contract of sale, or under a deed of trust or mortgage given to the vendor to secure payment of the balance of the purchase price of that real property or estate for years therein, or under a deed of trust or mortgage on a dwelling for not more than four families given to a lender to secure repayment of a loan which was in fact used to pay all or part of the purchase price of that dwelling occupied, entirely or in part, by the purchaser.

The refi is not the purchase. The money is being used to pay off the old loan. The nit being “purchase price” and whether that includes the action of purchasing. Another part might be last paragraph of section 580d. The refi is to secure payments to close out the previous mortgage(secure payment for)

This section does not apply to any deed of trust, mortgage or other lien given to secure the payment of bonds or other evidences of indebtedness authorized .

[ucodegen]

The particular company that first exposed this to me hasn’t produced an eval copy as of yet, but I found a ringing endorsement for the concept.

Don’t care about the ringing endorsement. The numbers don’t work out because the HELOC is more expensive per month.

In God We Trust, for all else bring data.

Numbers??

[ucodegen]

The particular company that first exposed this to me hasn’t produced an eval copy as of yet, but I found a ringing endorsement for the concept.

Don’t care about the ringing endorsement. The numbers don’t work out because the HELOC is more expensive per month.

In God We Trust, for all else bring data.

Numbers??

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