refinance rates | The Kwak Brothers

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Pay Off Your Loan Or Invest? Know What’s Better For You

Time and time again, I see people choosing to focus either a mortgage or an investment but not both at the same time. But which option is better to start with? In this article, I will show you how you can invest AND pay off your mortgage without the diminishing effects of either process. I want to show you that it’s possible to pay off your mortgage and invest simultaneously. More often than not, such a decision often depends on your financial situation. While many people believe that paying off money is best since it saves on your interest payments, others may want to invest their extra

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BREAKING! The Eviction Problem Just Got WORSE 😧

The eviction moratorium has completely expired and the US Supreme Court ruled against the CDC wanting to extend the moratorium. In addition to this, recently the Federal Unemployment Benefit also expired this week and the Biden Administration has no intention of bringing the unemployment benefit back as the economy is starting to open up.  https://www.youtube.com/watch?v=uaTUQruQjKQ In this video, I’m going to unpack what this all means and how real estate investors could potentially benefit from the eviction

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Older Posts

January 4, 2021

How to pay off a 30 year home mortgage in 5-7 years (2021)

How to pay off a 30 year home mortgage in 5 to 7 years. This is the most up to date version of our explanation on how you can pay off a 30-year mortgage in just 5 to 7 years on average. In the video, I will demonstrate how a banking strategy can be used to pay off a 30 year home mortgage in just 5-7 years without sending double payments, changing your current level of income, without refinancing, without loan modification, and without hurting your credit. Download Our FREE Strategy Calculator: https://chopmymortgage.com Key Parts: 0:00 Introduction 0:40 Disclaimer 0:54 Why is Your Mortgage Dangerous? 6:11 Why you should never Refinance!? 8:13 Intro to HELOC 8:32 HELOC vs Mortgage 11:19 Intro to Average Daily Interest 15:00 Intro to 1st Lien HELOC Strategy 22:52 Recession Impact on HELOC? 23:51 Free HELOC Calculator Download Disclaimer: I am not an attorney, accountant, or financial planner. This video is intended to be an educational video. This video should not be taken as financial, legal, and/or tax advice. Sam Kwak is a Certified Credit Counselor #11613. This is not a credit counseling session. I suggest that all viewers consult with professionals prior to implementing any or all parts of our strategy. RECAP OF THE VIDEO: I start this video with an explanation as to why a 30-year mortgage is like a trap for 21st-century homeowners. The reason being is that Americans (and Canadians) experience frequent life changes that cause them to move or they are eluded to refinancing because the refinance rates might be low. Unfortunately, such an event happens before 7-10 years into the mortgage. In the first 5-7 years, the vast majority of your mortgage payment goes straight to interest payment. A very small portion of your monthly payment actually goes to pay down the principal balance of the mortgage. Fortunately, there is a way to escape this. We’re going to introduce a new tool to help us with this called a Home Equity Line of Credit (HELOC) A HELOC is different than a traditional mortgage in several ways. The two main things to remember are (1) a HELOC is a revolving line of credit – which means you have the ability to pay back and re-use any available limit of the HELOC; and (2) a HELOC uses average daily interest calculation (simple interest) instead of an amortization interest calculation which is used by your 30-year mortgage. There’s a common myth out there saying that HELOC interest rates are always variable and higher. This isn’t true… There are HELOCs out there with fixed interests rate and some even have lower interest rates. Now, in 2021 – the best version of this strategy (in my opinion) is to use a 1st lien HELOC to completely replace your mortgage. By doing this, we now only have one debt against your home. No more 30 year amortized mortgage! Just a 1st lien HELOC. With the 1st lien HELOC, you’re now able to deposit all of your income (and event savings) into the HELOC balance to reduce the average daily balance – which ultimately means a lower interest amount you’ll pay on a daily basis. Doing this will keep the interest bill low while still being able to draw the funds out for expenses, emergencies, or even a rare investment opportunity. Now, you may have questions such as a.) couldn’t the banks freeze my HELOC? b.) are the banks still lending HELOCs? c.) how do you qualify for a HELOC? d.) What if I don’t have any equity? – I answer most of these questions on our […]
September 29, 2020

HELOC Strategy: Is it Still Worth It? (SERIOUS UPDATE)

We’re back with the HELOC Strategy content! (Velocity Banking, Accelerated Banking, Pill Method, Mortgage Acceleration). As you know, we’re a huge fan of using a HELOC to pay off your mortgage. But with the changing financial climate in the mortgage and refinance realm of banking, banks like Chase, Wells Fargo, and Navy Federal Credit Union, tightened up their lending of the HELOC or even canceled the HELOC completely. But other HELOC Banks continued lending out HELOC products to consumers. We have been getting many questions lately about whether to refinance or to continue to try and get approved for a Home Equity Line of Credit (HELOC). (HELOC vs Refinance) Is it still worth it to get a HELOC to pay off the mortgage early? Can you still use a velocity banking model to pay off the mortgage early? In this video, I am going to unpack the latest update on the HELOC and if they are still lending out the Home Equity Line of Credit (HELOC)! With the interest rates on mortgages being historically low, is using a HELOC to pay off the mortgage early worth it? Why not just refinance at a lower rate? Refinance mortgage rates are super low! And is the home equity line of credit (HELOC) still available from banks? Well, 3 banks that we know are currently not approving HELOCS; Chase Bank, Wells Fargo, and Navy Federal Credit Union, while banks like Citi Bank are still lending the home equity line of credit. But the approval times have skyrocketed for the underwriting process and this applies for the home equity line of credit (HELOC) & when refinancing. Why is that? Well, this really all has to do with the market. Banks sell mortgage products and continue to try and get you to refinance every 7 years. This is because mortgage-backed securities are sold on Wall St. And right now, major investment funds have NOT been buying these MBS because of the current economic situation, so banks are hesitant to sell mortgages to consumers. Is a HELOC still worth trying to secure or should you refinance? YES, the home equity line of credit (HELOC) is still the best option when velocity banking to pay off the mortgage early & you can use the HELOC for an investment property. HELOC(s) can also provide financial safety nets. HELOC vs Refinance (Refinance vs HELOC) So is it still worth getting the HELOC to pay off your mortgage? The answer is Yes and No… Now, remember, HELOC interests also ride on the WSJ Prime Rate. In fact, some HELOCs are based on LIBOR but next year, it’ll be phased out to SOFR (Secured Overnight Financing Rate) The current SOFR is at 0.10% which is ridiculous low. So if your argument is, well Sam… I just want to refinance because the rates are low… Why not get a HELOC that also has a low interest rate. Some of my clients in our private membership got a 2.99% HELOC or 3.75% 1st lien HELOC. But using a HELOC to paying off your mortgage transcends playing the interest rate game because you’re driving the principal balance down so low that even at a higher rate, the effective interest amount on the HELOC is lower at the end of the day. PLUS… you can use the same HELOC to acquire investment opportunities such as buying rental properties and cash cow businesses that have higher return than the HELOC interest rate.
July 10, 2020

Mortgage Rates Are PLUMMETING! Should You Refinance Your Mortgage? (WARNING)

Mortgage Rates Are PLUMMETING! Should You Refinance Your Mortgage? It’s one of the biggest headlines right now when it comes to the housing market. Mortgage interest rates are continuing to drop to a historically low rate. This opens up the idea of refinancing your mortgage to get a lower interest rate. How to Pay Off Your Mortgage In 5-7 Years https://youtu.be/3f-ebCjeH8o Sounds good right? Sure! BUT in this video, I am going to EXPOSE all the hidden costs of refinancing your mortgage and how mortgages work to keep paying the bank interest instead of paying off the principal. A low number on your mortgage rates look good on the outside, but when you dive deep into the ACTUAL cost of that mortgage rates, it WILL shock you with how much you actually pay! Lower mortgage rates DO NOT automatically mean you’ll be saving money. With mortgage rates continually dropping to a historical record low, many homeowners are looking to refinance their mortgage. I am advising AGAINST refinancing at the time regardless of the record low mortgage rates. Here is why: Your mortgage is on an amortization schedule, meaning that on a 30-year mortgage, the majority of your monthly payments for the first 7-10 years, will be going towards the interest owed on your mortgage. So, if your mortgage payment is $1000, $800 of that payment goes towards interest, while the remaining $200 goes towards the principal on your mortgage. Within 7-10 years of paying this mortgage, eventually, most of your monthly payment will go towards the principal and then less will go towards interest. Here’s the catch though with refinancing for lower mortgage rates.. When you refinance to lower mortgage rates the amortization schedule RESTARTS to DAY ONE! This means the majority of your monthly payment will go BACK towards INTEREST and less will go towards the principal balance! Not to mention all the extra fees; closing costs, administrative fees, appraisal fees, underwriting fees, title fees…….all for refinancing to lower mortgage rates…… This is almost criminal……..so it’s almost like the mortgage rates DON’T MATTER when it comes to actually pay off your mortgage! BUT never fear, here at The Kwak Brothers, we specialize in paying off your mortgage QUICKLY! Here is a link to a video we created SHOWING you how to ACTUALLY pay off your mortgage within 5-7 years, WITHOUT refinancing to lower mortgage rates!
June 23, 2020

If Banks Were Actually Honest…

What if Banks and Bankers were ACTUALLY Honest about all the hidden fees and their “secret” schemes to make money off of you… You’re getting a mortgage and you’re thinking ‘What can ever go wrong?’. Well, in this comedy sketch, we want to show you what it might look like if bankers were actually honest about all the mortgage closing costs, fees, how the banks make their money, how they want you to refinance every 5-7 years, and what they really think about mortgage rates and refinance rates. Enjoy! 📉 Learn How to Pay Off Your Mortgage in 5-7 Years (On Average): https://www.youtube.com/watch?v=3f-ebCjeH8o Honest Banker – Played by Sam Kwak Mr. Enslavedski – Played by Sam Kwak In this comedy sketch, we wanted to highlight and exaggerate some situations that every borrower and banker go through when it comes to shopping for a mortgage or for a refinance loan. Typically, banks want you to play the game of “shopping for rates”. The banks REALLY love 30-year mortgages because in the first 5-7 years, you’re really not paying much principal but you are paying a ton of interest. This is often known as the “front-loaded interest” zone. The banks know that majority of the borrowers will come back to refinance or get a new mortgage in 5-7 years. But hardly any borrowers make real progress in building equity in only 5-7 years with a 30-year mortgage. Typically on a 30-year mortgage, banks can make up to twice as much as the original mortgage balance. This is why it’s so profitable for banks to lend on a 30-year amortization. Plus, the Mortgage-Backed Security industry loves these 30-year mortgages because they’re often backed by the Federal Government and thus, are highly regulated. While this is just a comedy sketch, we wanted to highlight some of the REAL situations and what the banks are REALLY thinking when lending these mortgages to you, the consumer. Don’t fall for these traps by playing their game! Learn the rules and how banking works! 📉 Learn How to Pay Off Your Mortgage in 5-7 Years (On Average): https://www.youtube.com/watch?v=3f-ebCjeH8o