Thursday, August 27, 2009

100 % Returns

How to Make 100% or More on Your Money

No, this is not some futures or commodities trading strategy. You don't have to join a cult or an MLM. And you can do this for years.

The only qualification is that you have a mortgage or home equity loan.

You can achieve more than 100% returns on your money simply by paying extra money on your mortgage each month or as often as you like.

Here's how it works: If you have a 30 year mortgage at 7%, for each $100 of your loan amount you will end up paying as much as $209 in interest. So within the 30 years of paying off your mortgage, you will repay that $100 that you borrowed PLUS you will pay up to an additional $209 in interest.

So if you "invest" an extra $100 along with your first mortgage payment, you will end up saving $209.42. That's a return on your "investment" of 109%! And it's guaranteed.

Plus you have just lowered the amount you are in debt and reduced the time it will take for you to pay off your mortgage. How many cold-calling investment brokers can offer you a deal like that?

So you could look at it as investing the $100 in your mortgage means that there is $309.42 you won't have to pay out in the future. You could even argue that this is a return of 209%.

But what if you are several years into your mortgage. Well, even if you are 10 years into your mortgage (and the average mortgage only lasts about 7 years these days), you can still save $139.42 in interest by paying an extra $100. Or if you are 20 years into your mortgage you will still save $69.42 by paying an extra $100.

So what have you got to lose but your mortgage debt?