Turn That Fixed Rate Mortgage Into A Goldmine

When you purchased your home, you most likely got a fixed interest rate mortgage with a 15 or 30 year term. These are the most popular mortgages in the industry. Even in the summer of 2004, when the interest-only or simple interest mortgage loans became popular, the average American stuck to the fixed rate. You see, the fixed rate offers security to conservative people, and the average American home buyer and home owner is a very conservative person.

Today, it's time to ignore that conservative nature and throw out that fixed rate mortgage. If you have a home, no matter when you purchased or refinanced your mortgage, you now need to refinance your fixed interest rate mortgage to an adjustable rate mortgage.

Now, before you begin to panic and start calling me all kinds of unsavory names, read on, and you'll see why an ARM is actually a cash goldmine, and you need to start panning for this gold immediately.

When I was originating loans fulltime, I could barely get the word ARM out of my mouth, before the customer would say, "Oh no! I don't want an adjustable mortgage. I've heard how the rates change and your payment skyrockets, and some people actually lose their homes. No, no, I don't want my rate to change." Of course, once I illustrated the thousands of dollars they would save in just a few years and quashed all of those myths about loan payments "blowing up," most of them decided the ARM was not the "devil loan" it's made out to be.

But why risk an adjustment of your rate, you may ask, when you can have it fixed for the life of the loan? The answer is twofold and quite simple. The first part is the most important, and that is the average American either sells or refinances his or her home in four to seven years. So, if the chances are that you'll sell or refinance in five years, why fix your rate for 30 years at a higher interest than you can get on an ARM?

The second reason to get an Adjustable Rate Mortgage is because the interest rates are so much lower than fixed rates. And since these great rates are fixed for a particular period, five years on a 5-year ARM and three years on a 3-year ARM, there really is no risk, at all. Again, in most adjustable rate mortgage programs, the interest rate does not adjust monthly or yearly (although programs with these types of adjustment periods do exist at much lower rates).

For example, as of publication of this article in 2004, the 30-year fixed rate mortgage was going for around 5.75%, and a 5-year Adjustable Rate Mortgage was going for about 4%. Suppose you're financing $100,000. The 30-year fixed rate of 5.75% would give you a monthly payment of $583.57 (not including your taxes and insurance, which vary from state to state and county to county). The same $100,000 financed at 4.0% interest yields a monthly payment of $477.42. The difference in these two payments is $106.15. This is $1,273.80 each year, and $6,369.00 for five years. I can hear you saying, "Wow, that's hard to believe," but these are real numbers and real savings. You may be saying, "Sure, but the rates change." This is true, but the difference in the fixed rate mortgages and the ARMs is almost always the same, regardless of what rates the market bears, so you'll always save a ton of money in the difference in these two payments.

The numbers are even more staggering if you finance $150,000. The fixed rate payment is $875.36 and the 5-year ARM payment is $716.12 ? a monthly savings of $159.24 and over $9,500 for five years. If you buy or refinance a home and finance $200,000 or more, you'll save between $13,000 and $15,000 over five years, with the 4% rate as opposed to the fixed rate of 5.75%.

Bank that money and you can buy a decent car for cash, or pay for a year of college, or take a European vacation. Pretty powerful stuff, huh? Now, if you're one of those people who is really into cutting into the term of your mortgage, and you can afford the higher fixed-rate payment, simply apply the difference back to the principal loan amount. You'll build equity in your home very quickly, and you'll always have the option of paying the lower payment.

So, get your adjustable rate mortgage today, and start using your own personal goldmine.

Mark Barnes is author of the wealth-building system, Winning the Mortgage Game and other investment real estate books. He is also a suspense novelist, and his new novel, The League, will thrill both suspense and sports fans. Learn about Mark's wealth-building system and get his free home loan course at http://www.winningthemortgagegame. com. Learn more about The League and read an excerpt at http://www.sportsnovels.com

Who Else Wants To Know Oprahs Secrets To Wealth & Success?

Before I had a lot of money, I was really quite happy," said Oprah Winfrey.... Read More

21 Secrets of Self Made Millionaires

Self-Made Millionaires are not smarter or better than you. They have just discovered these secrets... Read More

The Secret Barrier To Wealth - Underearning

Is the ghost of "Money Past" haunting you? Do you feel like no matter what... Read More

Four Pillars of Creating Wealth

Some people in this world are thinking that their poor financial condition today is their... Read More

Increase Your Business with a New Old Method: Vaastu Shastra

Whether an established conglomerate or a fledgling company, a business in the red or black,... Read More

Want Money? You Got It!

Six out of six people who were asked to list their highest priority in life... Read More

Spiritual and Emotional Money Goals: The Keys to a Financially Free Future

Are you setting the right money goals?Most people believe having more money would mean having... Read More

Do You want to Live on Macaroni and Cheese when You Retire or Filet Mignon?

How Much Money Will I Need to Earn to Retire?This is the most common concern... Read More

10 Ways To Find The Money Hiding In Your Paycheck

No matter how tight things are financially for you; no matter how bleak you think... Read More

Plan For Wealth

One very important wealth creating habit is to set up a concrete plan that you... Read More

What is Your Creative Retirement Plan?

The idle are a peculiar kind of dead that cannot be buried." Oriental proverbOne thing... Read More

The Predicament of the Newly Rich

They are the object of thinly disguised envy. They are the raw materials of vulgar... Read More

Self Improvement and Financial Security for the Future

Any successful person, or any anyone interested in self improvement and making a better life... Read More

Building Wealth: A Wealth Building Strategy Is More Than Simply Diversifying Your Investments

Wealth - an abundance of values. Each of us determines what is or is not... Read More

Top 10 Secrets of Getting Rich!

As many people have observed, "Success leaves clues." If you want to achieve extraordinary success... Read More

Trustees: Who Can You Trust?

Early in my legal career I represented two young women in their early 20s.Their mother... Read More

Your Money Or Your Life

Have you stopped to realize that although you go to school to learn about... Read More

What it Means to be Rich

Many people have a false understanding of what it actually means to be rich. If... Read More

It Adds Up

Loose change that is, if you want a easy way to start saving a little... Read More

The Philosophers Stone

"If you know how to spend less than you get, you have the philosopher's stone"... Read More

Thought Creates Reality Even When It Comes To Money

What if I told you that reading a book would also change the way you... Read More

The 11 Best Money Saving Ideas of All Time - Part 2

At any time in history, no matter what the current state of the economy, no... Read More

The Old Monied Dupont Nemours and Roosevelt Families Buy a Tax Haven

This 4,000 acre sale (now a marina and resort town - with an airport for... Read More

Learn How to Bank Like a Banker

The business of banking has changed dramatically over the last decade. Because the cost of... Read More

Investment Techniques For Creating Passive Income

There are many wealth creation strategies and investment techniques available to those who are looking... Read More

Top 7 Ways To Get Rich

Want to be one of the lucky ones on the road to riches, want to... Read More

One Pipeline Is Worth A Thousand Paychecks

It is with great pleasure of having you here at this hour. Let me get... Read More

How To Be A Millionaire - The Top Secret Of Wealth Creation

Have you any idea how many people search Google every single day for terms such... Read More

Money Myths Of The Poor

From tender age, we were exposed to myths about money and myths of being rich.... Read More

10 Ways to Save $50 Per Month: The Art of Pinching a Penny Until It Screams

1. Save up to 50% per month on convenience cleaner cloths by cutting them into... Read More

The Truth About Setting Up A Wealth-Pump Business: The Passive Income Myth Exposed

In theory the idea of generating additional (and passive) business revenue from ... Read More

You Can`t Cheat An Honest Man

Author: James Walsh ISBN: 1563431696: Publisher: Silver Lake PublishingIn 1903 Charles Ponzi arrived in... Read More

Does Money Grow On Trees?

"Money Doesn't Grow On Trees."Some of us even believe it. An orchard owner would say... Read More

Its High Time for Lifetime Savings Accounts

I'm constantly reading articles on the internet and in financial magazines in which so-called financial... Read More

Compounding: The Science Of Exponential Money Generation

It all begins with a simple calculation.You are home on a rainy Sunday afternoon, looking... Read More

The Financial Equation that Will Set You Free!

I have a good friend who works in an area of the US that has... Read More

Tax Help - Girls (and Guys) Just Want to Have Fun by Using Tax Saving Tips

In his best selling book, "Rich Dad, Poor Dad, Robert Kiyosaki warns people against the... Read More

The 11 Best Money Saving Ideas of All Time - Part 1

At any time in history, no matter what the current state of the economy, no... Read More

Starting With Smaller Goals First And Work Your Way Up Until You Achieve Financial Freedom

While you need to have a lot of positive-thought and confidence in order to be... Read More

Turn That Fixed Rate Mortgage Into A Goldmine

When you purchased your home, you most likely got a fixed interest rate mortgage with... Read More

Steps to Financial Freedom

Financial freedom is the power to do what you will with your life without being... Read More

Tax Strategy - Theres More to Building Wealth than Clipping Coupons

We talked recently about the wealth formula:Spend less than you earn and save the difference.... Read More

What Are Your Beliefs About Money and Wealth?

What is your attitude towards having wealth? Do you believe it is possible to have... Read More

Thieves Continue to Pull Off the Biggest Heist in History?Until Now!

Imagine being able to steal untold millions of dollars in plain view without getting caught.... Read More

Wealth - 10 Basic Steps to Achieving It

Everyone wants to be wealthy. Only a few actually achieve it though so following these... Read More

Budget Tips

To budget, to have a budget and to be on a budget is not a... Read More

Start A Cashflow Club

The cashflow board games, Cashflow 101, Cashflow 202, and Cashflow For Kids, were designed by... Read More

Learn To Budget

Do you like so many others feel, that even if they are earning well, are... Read More

Principles to Ensure a Fantastic Financial Finish

Most people want to get to the end of their lives and be able to... Read More

8 Tips for Keeping More of Your Hard Earned Money

Masters degree not required...just a little common sense, a $5.00 calculator and a realistic plan... Read More