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  • Writer's pictureKris Krohn

How To Pay Off Your Mortgage

Want to learn how to get your house paid off? I have ways that are tried and tested - surely effective to get your house paid and allow you to earn more! These four methodologies are the key to real estate, so stay tuned and learn from my experience!

So today we're talking about accelerated methodologies for how you pay off a mortgage. And I'm gonna show you four different ways to do that.

Like if you wanna accelerate and get that house paid off, I'm gonna tell you that my whole journey of buying thousands of homes began with my fascination of the fact that I was on the phone doing telemarketing in college, talking to people who had gone to college, followed society's plan, and then got a house.

And you could tell that the, the burden of like owning a house worth having hundreds of thousands of dollars of debt, it bothers people, right?

It's like the biggest payment in your life. And so I noticed that a lot of these people 20, 30 years later with refinancing and restructuring the loan, they weren't getting their houses paid off. And they're at some point you get old enough where it's like, this is like a, a weight and this is a pressure. So as a young man in my early twenties, I'm like, there has got to be a way to get this house paid off quicker and faster.

So I am gonna share four methodologies with you today. And with that we're gonna get right to it because we're gonna be legend here.

It's about to be legendary. So come on into my secret lab that isn't so secret, but it is my studio. And what we're gonna do here is I'm gonna kind of throw up on the board what these four options look like and um, break this down for you. So Chris, you might be asking, what is the most traditional way that people go about paying something off? Option number one is that when you get a house, the typical mortgage in America is what's called a 30 year fixed mortgage.

And What a 30 year fixed mortgage is, is basically it's a bank saying, oh, we're lending you money and let, let's just use round numbers. You, you're buying a house for $300,000 and you're thinking to yourself, all right, what's it gonna take for me to pay off this house? The bank says, well, we'll help you pay it off in 30 years. But it's not just taking 300,000 and dividing it by 30 years of mortgages.

You're actually gonna pay for that house like two and a half times over and the bank is gonna make all that money and interest. And I don't wanna go into too much of that detail 'cause I think it's a little bit boring, but I want you to understand that the bank wants their money if they're gonna work with you for that super long period of time. Now, the way that they do this is they basically say, oh, 30 year fixed mortgage, here's your payment.

And if you make that payment every month for a year, that's 12 months. If I do it for 30 years, it's like 365 payments. And if I were to do that for 30 years, the bank would get all of their money back a couple of times.

Plus you'd get own the house free and clear. Free and clear means you have no more mortgage on it, you got no more payments and you own it. Here's the funny thing about this. What you need in your thirties when you buy a house is what you think you'll need in your fifties or sixties. Dude, probably not. You might have kids, you might have to move, you might get job changes, you could move across the country, you may have to downsize, you might need to upgrade. The reality is no one keeps a 30 year fixed mortgage. And here's the problem.

The banks front load all of the money they get in the beginning. So if I had a payment of let's say $1,500 a month, like 80 bucks is going towards the principle, the rest is going towards interest and the bank knows this. They know that there's a high likelihood you're gonna move or change your life in the next seven to 10 years. So basically almost all the money that you're paying on this 30 year mortgage goes to who?

The bank. So you're not even paying the house down hardly at all. It sucks, but it's true. And if you're the kind of person that's like, actually Chris, I've got a pretty boring predictable life and not much is ever gonna happen to me and I'm not really gonna go places, and what I want today is what I want 30 years from now. If that's you, then something like this might work.

But for you to actually gain the bank at this system, you'd have to hold onto that mortgage for at least 25 years, sucks. So then you start saying, you know what? I am now aware of that Chris, there's gotta be a better way, a faster way to pay off my mortgage. And you know what they do?

The bank said, you know what, for those of you want to be more aggressive, to be more conservative. So we're putting those two words together. We're inventing something called the 15 year mortgage. And here's the way the 15 year mortgage does. You're not gonna pay so much outta interest, but you're gonna have a much higher payment. So instead of a $1,500 a month payment, maybe your payment is $2,200 a month. And guess what? You only have to pay it for 15 years. And some of you're like, Hey, this is fantastic.

It's not fantastic. You're gonna bleed more cash flow, you're gonna put more money into the house, and what you're really doing is investing in your house. Problem is your house doesn't pay you anything. It's a liability. Even though it'll appreciate with time and the value will go up and you'll look back at some point and be like, wow, I have so much of my assets and net worth in my house.

This was a great decision. You'll have done it the most inefficient way possible. If you want the bank to win, play their games. I don't like the bank to win, I want to win. I, I'd like everyone to win, but the bank here is gonna collect so much money off of you. It's ridiculous. And if your life changes in the next three, four, or five years, you're not gonna really reap the benefits of that.

But more importantly, you don't have as much free cash flow because you're dumping it from your own pocketbook, you're dumping it back in the bank as if it's an investment. It's not an investment. Then you say, alright, I wanna do something even more aggressive. That's it. You're like, you know what?

I don't want the bank to win. So you know what I'm gonna do? I'm gonna get on either a 15 or a 30 year mortgage, but what I'm gonna do is I'm gonna throw extra money at the bank. If my payment's 2000, I'm gonna pay 2,500 this month.

And why are you doing that? Because you wanna pay it off quicker and add more principle, which means you're gonna pay less in interest. Problem is you're still playing the bank's game. Now, I do have an option that I do believe in. It's not one of these three, and at this point you might be wondering what it is. And my friends, this is why you're watching the video and that's why you've gotten to this point. It's for this moment right here.

So I'm gonna give it to you. I'm gonna tell you however, that it's different than what most people think. I don't believe in ownership, I believe in control. And while I can't control people, I can control money to some extent.

I wanna kind of break that down for you. Being a young man and realizing, oh my gosh, paying off my house is like, it's one of the hardest things to do. It takes so long. What's a faster way? Instead of putting extra money in the bank, take that extra money. And option number four is put the difference into an investment property investment real estate. Imagine for just a moment, if you bought a house that had at least a 20% annual R O I, and let's just say that instead of paying down that house more or putting a bigger down payment on it, let's say that you put $40,000 down on a 200,000 house that represents, by the way, about a 20% down payment.

And it's like I could take that 40 grand and put it in my house and pay off my primary residence sooner, but instead, you know what I'm gonna do? I'm gonna take that 40,000, I'm gonna put it into an investment property, and if I'm earning a 20% r o i, here's the question, how long does it take for me to double my money? 1, 2, 3, 4, 5 years. 20%, 20%, 20%, 20%, 20% adds up to 100%. 1, 2, 3, 4, 5 years. So just imagine for a moment that you could double your money every five years if you could do that.

Then five years later, 40,000 has become what? Well, it's become 80,000, but five years later, 80,000 has become what? 160,005 years later, what does it become? It's become $320,000. Now, by the way, we did this in 15 years just by buying one investment property, you could freaking pay off your house right now and have leftover money to invest.

Let me share with you the scenario. I find people in all day long, and this is how I've helped people really grow themselves.

I'll find people that own a house already. It's a primary residence and they've got some equity into it. Let's say it has a value of $300,000. That's what, that's what it is worth in today's marketplace. But what they owe is $150,000. Now, if your house is worth 300 K and you owe 150 K, then how much equity do you have? Equity means the difference between what you owe and what it's worth.

So this is the V for value. O is for owing, and we're gonna use E for equity, and the equity is also 150,000. If I take my equity and when I own and add it together, I get the value of a home. So what can I do with this equity of $150,000?

Well, most people can go to a bank, borrow up to 80 or 90% of the value on their home. In this situation, probably free up about $80,000. Now, the bank will let you actually borrow that. It's called a home equity line of credit, or you could just refinance the house. The bank gives you 80 grand 'cause they're like, dude, this is an asset. You have this money. What could you do with 80,000? Now first of all, you're thinking, Chris, I'm freaking trying to actually like pay off my house. Like if I pull 80 grand out, guess what? I don't owe 150 anymore. Now I owe 230 grand like I'm freaking going into debt.

This is not the plan. Watch one step backwards might mean 10 steps forward. This 80,000 is enough to buy what two homes. If those homes are earning 20%, then in five years, I can turn my 80,000 into what? 160,000 by year 10.

If I turn that Into $320,000, what can I do with that $320,000? I can pay off my house, I can have leftover money, and I did it in 10 years. I didn't do it in freaking 20 years, and it'll be even faster than that. When you actually look at the compound interest effect, today's video, I wanted to kind of open your mind and let you know there is a smarter way, there's a better way.

But you gotta be thinking, how do I access homes with a 20% r o I? Well, most of my homes have a 25, 28, or a 30% R o i, which means I can double my money sometimes every three years. If you'd like to learn more about that, couple of things. One, I highly recommend that you actually get a copy of this book. I'm giving it away to you today for free. There's a link below.

This book will share with you exactly how I do that, and there's another link below, maybe a more important link that says, partner with Chris. It'll take you to a page where I'll show you my track record on my last 4,000 homes, and I'm also gonna share with you how I get 25 to 30% ROIs. If you like what you find there, you can talk to my team and I can actually show you how to pay off your home, not only a lot faster, but more importantly, create the real dream, which is not a paid off home.

It's called financial freedom. And I don't mean financial freedom is like I'm rich, I'm a billionaire. What I really mean is getting un mortgaging your life, not just your house. How do I live life on my terms? How do I get the residual income I need to get my time back and and do the things that I want with who I want when I want?

I figured all that out by the age of 26, and now I've been able to magnify it and take it to a whole new level. We got this one life to live. Don't let the banks own it. Don't play the bank's games. Their games take so freaking long. The reality is there's a better way, a smarter way, a faster way, and frankly, a safer way. So do yourself a favor. Pay off your house the most intelligent way possible. My name's Kris Krohn. I hope you enjoyed today learning about the four different ways to pay off your house.

Links are below to learn about how you access my deals, earning 25 to 30%, or how you can get a free copy of my book. Either one of them can be super helpful on your journey of figuring out how to become financially free and take total financial control over your life. If you're brand new to the channel, make sure you subscribe. I got new videos coming out every day to teach you how to be your own financial genius. Take care.

How To Pay Off Your Mortgage Early

Alright, YouTube friends, Kris Krohn here with Limitless Wealth tv and today we're talking about how do you go about paying off your house early. And I'm gonna share with you hands down my favorite strategy, kind of compare it to society's strategy and see if we can help you take a 30 year game and turn it into a five year game. All right?

How do you get your house paid off fast? This is a really, really, really good question, but before I show you how to pay it off as fast as possible, let's first understand that I'm not gonna share with you the traditional methodology, right? Here's the traditional methodology, here's my house and I'm gonna do a 30 year plan that just happens to coincide with a 30 year mortgage, right? Um, some of you might say, but Chris, I got a 15 year plan.

Yeah, that's the 15 year mortgage. I get it right? I own my property, I'd like to get it paid off on a 30 year plan. You're gonna pay for that house two and a half times. That's because of what you have to give the bank upfront with interest fees. And as it amortizes out over the course of the life of the loan, the bank is gonna make a lot of bank on your property.

And I don't necessarily have a problem with that, but if my goal is to pay it off, are you open to a more intelligent approach? Well, my approach is a little bit different. This is a real estate investing channel. So let me share with you what I would do to take 30 years and turn it into five years. Would that be cool for you? Okay. First of all, you got this property and if you're aggressively throwing money at it, then chances are you're building some equity with the property.

Banks will usually let you lend on up to 80 or 90% of the value of your home. So let's just entertain a scenario where you have some equity in this home. Let's say that you have $50,000. Now there are two ways to access this.

You could do a cash out refinance, incur probably five, $6,000 worth of of lending fees or you could do it for free with what's called a home equity line of credit. I really like HELOCs. The HELOC basically says you have a $50,000 line of credit like a credit card, but it's tied to your house and when you use it, then we charge you interest. When it's paid back, we don't. HELOCs usually are super cheap money, let's call it three to 4%. So all of a sudden I've got 50,000 line of credit and I'm like, well this is good. That means that I've paid off some equity in my house.

Why on earth would I ever use that home equity line if my goal is to pay it off, this is where I'm gonna show you how to take one step backwards to take two giant steps forward. Here's the faith leap. Take that 50 grand and let me show you how to put it into another property. That is an investment.

This is P for primary. This is your home. This is the one that we wanna get paid off and if you wanna pay it off faster, we're gonna allow an investment property to help make that happen. Let's say that we find a house with a 20% discount in an equity growth market. I've got houses that I do every single day just like this. So I take you one one of my markets and we get a 20% discounted home. The 50,000 is another 20% down payment.

So now all of a sudden you got the house 40% paid down, it's almost half paid off. And when a house is half paid off, do you know what that means for the cash flow in my system? That means that the cash flow is really high.

First of all, high enough that when you do borrow the home equity line for this, that three to 4% is going to have a monthly fee. Let's call it $200 a month. But if we're here, I'm making $500 a month, then guess what? That means that I've got enough money here to pay that. And that's the principle that you need to understand. You are creating more debt and then when you buy an investment property to 60% still there, that's also more debt. Now I've got more debt here and I've got more debt there. That's the step backwards.

However, what happens if you cash flow is home $500 a month, you're netting 300, 'cause 200 goes back to pay your home equity line. What happens when that home in these growth markets experiences five 8% annual appreciation and let's just say in two years you have a choice. You can sell that home, you can get your 20% back out and wipe out your home equity line. You can get the 20% that you found the property with.

You've got all your cash flows you collected on it, plus you've got the growth in the market. Let's say that you could sell this house and make $50,000 after paying this 50 grand back. Now just think about that for a minute. We went in, played real estate game monopoly for a couple of years and look what happened. We returned the $50,000, which means that our debt went down.

But if I wanted, I could take this 50 grand and pay, pay off my house 50 grand faster. Do you know, do you know how much you actually paid down your house in five years to the bank? A whole lot less than $50,000. So you've done something really, really good here. In addition, you were still paying down your house.

Now I wanna ask you, do you wanna put the 50,000 of profit into this house or would you like to put it in another house? Well, if it worked one time and I've gotten it to work thousands, then you'd go and say, well I wanna buy another house. And you might say, but Chris, what if I use that home equity line and I use that to also buy another house? In fact, what if we strategically put our money together that we bought three smaller houses.

Well, guess what? I have now? Cashflow, cashflow, cash flow even more than I had counteracting the home equity line. I've got equity, equity, equity. And let's just say in a few years I go to sell those houses and now all of a sudden I've been roll, been able to roll that into $180,000 of profit after I've paid back my home equity line again.

Now I come back here. If you've got a normal sized house, like most people, you paid off your house and then you get the other dilemma. But couldn't I keep investing? Yeah, you could keep investing, but now you have a paid off asset and now you have other assets to go and buy more real estate. So ultimately two choices here, right? You can pay off your house through the bank, which is why you're gonna pay for it two and a half times and it's gonna take 30 years.

Or you could do it a whole lot faster by using some of the equity and by putting it into more real estate. And that's how you pay off your house a lot faster. If you, you want a professional team that will help you build a portfolio and maneuver all that and make all of that happen while letting you have a hundred percent of the profits, you may want to check out my website and see some of the things that we're doing around here. 'cause I'm telling you, we're all about accelerating your results and helping you experience exponential growth in your wealth.

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