The biggest risk is the user. Within a short period of time, the homeowner will have access to more cash than he or she may have had available for a long time. Some do not have the self-control to be able to handle access to that much cash.
We do not micromanage our clients' spending, but the very system itself lets the borrower know if he or she is on track.
If a person does not possess the inner constitution to control spending, this is not the best program for them. We are happy to refer you to our Dave Ramsey coach to assist in overcoming compulsive spending. We realize right now is not always the best time, but we will remain available to assist them in the future.
Beyond that, if a person is willing to follow our recommended processes, they will reduce and mitigate risk.
Well...It's a bank!
This is not a securities product. These have nothing to do with the stock market and therefore have no Stock Market risk.
Are banks safe? They are highly protected by Federal Deposit Insurance and the US Government, neither of which want them to fail.
Banks have basically three main assets: 1) Their own investment portfolio, 2) the bank property and buildings and 3) their loans. Their portfolio fluctuates and the land generates no income. The most stable of the three are loans. Loans are the bread and butter for the lender (even when the loan is sold to the government or another lender).
If a bank gets sold, mortgage loans are the assets the new lender finds desirable. Why? Because they are secured with collateral, your home. That makes them the safest of all loans for investors and banks and ultimately the borrower.
No. There are two main strategies within Fire My Mortgage® and two others for unique situations. Two of those four strategies does not replace the current mortgage, but usually pays it down just as quickly. We evaluate every household on a case-by-case basis to determine which is best for their unique situation.
Interest rates have very little bearing on the outcome of this strategy. Banks have trained consumers to focus on the points. People will pay extra closing costs to lower their interest by 50 basis points (half a percent). However, the biggest accelerant to growth (or loss) of money is not the interest rate. It's time! Change TIME and RATE has very little power.
Will an investor make more interest by earning 8% for 8 years or 3% for 30? The power of time and compounding (and a calculator) says they will earn significantly more over a longer period of time even with a less favorable interest rate. With a mortgage, the borrower is on the other side of that trade, so they will save significantly more by paying off the home in a shorter period of time even if the stated Annual Percentage Rate (APR) is higher.
This is the difference between the stated APR (Annual Percentage Rate) and TIP (Total Interest Paid) BOTH of which are on the disclosure page of your mortgage documents. Because money increases in power over time. When one invests, time is a friend; therefore, one should continue that practice as long as possible. When one borrows, time is the worst enemy; one should get out of debt as quickly as possible. (Unless they know how to leverage debt to make more money, a method known as "arbitrage.")
Many question if this will work for them. We have found that 7 out of 10 people are able to do this strategy with amazing results.
The process is complimentary and confidential. Our clients will never get into a situation where they have agreed to something without knowing it. We are very clear during every step of the process and our guests will never be made to feel uncomfortable.
Fire My Mortgage® is Independent. This allows us to choose from any company that will meet our clients' needs. We do not answer to shareholders or to a board of directors. Our clients are our only clients!
Fire My Mortgage® is Fiduciary. This means we will put our clients' needs even above our own. We will never cause harm in our recommendations. Everything is with their best interest in mind.
Fire My Mortgage® is chiefly operated by James Murphy who holds the following licenses:
Having licenses does not validate a person, but they do allow one to talk about things that unlicensed people cannot. We also have an Advisory Group with other professionals who specialize in these specific categories.
(See Disclaimer in the footer.)
No. This is not an investment or insurance product. If a client wishes to compare rates we are able to do so but will be crystal clear when we are "changing hats."
This is a strategy utilizing better math and logic. Commonly we will use bank products with which consumers are already familiar.
(See Disclaimer in the footer)
The process of exploring our clients' numbers is both complimentary and confidential. You will never get into the situation with us where you have signed up for something without knowing all the details of the commitment.
Fire My Mortgage® is not remunerated by lenders. We are independent coaches and are paid a one-time fee-for-service and that number is affected by what the client would like to do.
We work with the homeowners throughout the entire process until they are 100% debt-free of current debt.
The out-of-pocket amount varies by client and they will never get to the place where we are quoting an amount if the goals of significant time and interest savings are not met.
We love Dave Ramsey and Suze Orman, but we reject the lifestyle of living on beans and rice! Living on a strict budget is like most crash diets; they last for a short time, but are not sustainable. (This is why out of the hundreds of thousands of listeners only a few call in to scream, "We're debt-free!!!")
We do not usually ask our clients to spend less. We are running their numbers based on their current lifestyle and we are not asking them to drastically change it.
That said, they will have access to more cash than they may have seen for a long time. In the same way we do not ask them to spend less, we do ask them not to spend more just because it is there. Everything in moderation.
This strategy is not limited to bigger homes or smaller homes. The reason is logical. Typically people make more income and have greater expenses in more expensive homes. Typically people make less and spend less in smaller homes with smaller mortgages. In other words, it usually scales.
For this reason, we customize the report to every household taking into account their unique income, expenses, debt, cashflow and future purchases.
Yes. Amazingly so.
If this is of interest, ask us to show you how that part works. We call that Fire My Mortgage ® 2.0.
Yes, most of the time.
For businesses, we will gather the Profit & Loss statements and Debt numbers.
If we see a solution that will make a significant impact, we will show the results of the strategy if implemented. However, we will explain the process only after the business has subscribed to the service. It will be up to the purchaser to "sell" the idea to their board of directors and/or other decision makers.
Once all decision makers give their approval, Fire My Mortgage® will assist with introductions, applications and execution of the strategy.
This strategy is not limited to big homes or smaller homes. The reason is logical. Typically people make more income and have greater expenses in more expensive homes. Typically people make less and spend less in smaller homes. In other words, it scales.
We are not lenders, brokers, nor do we work for one. We are never remunerated by the lender nor does Fire My Mortgage® pay the lender.
We are Financial Planners and are part of a network of homeowners who have found a better way.
No. It's definitely not new.
This strategy has been around for several decades in other countries and for over 15 years in the United States.
We did not create this, but we compiled information from many strategists, simplified it for regular people and then put it together in an easy-to-follow system.
This strategy has been widely used in Canada, Great Britain, New Zealand and Australia for decades. We have seen it in America for over 15 years.
There are only a handful of companies in the United States offering this specialized conversation. We do not have the deep pockets to advertise during the Super Bowl.
Big banks have done a great job of convincing culture that the traditional mortgage is the only way to buy a house. They make so much more from the traditional mortgage which traps borrowers in a lifetime of interest payments. There's no reason for them to change their message any time soon.
Most people innately know that there are better ways of doing things, but we are all limited by our own knowledge and experience. Every industry has hacks. James Murphy, founder of
Fire My Mortgage®, has been in Financial Planning for over 20 years. Admittedly, this is his most treasured discovery.
Knowing something doesn't make it true and not knowing something doesn't make it not true. We simply ask people to objectively look at the math and logic using their numbers and decide for themselves if it makes sense.
If it does make sense, we ask them to spread the word to their friends and families.
Fire My Mortgage® is changing lives, one home at a time.
We do not advise pulling money out of the Stock Market to pay down the home.
The only time pulling money out of an investment account makes sense is if Cash is sitting in a brokerage (non-retirement) account and the investor has no immediate plans to put it back into the Market.
We never encourage people to pull money out of Retirement Accounts due to taxes, possible penalties and loss of opportunity. We also do not encourage people to pull money out of their home to invest in the stock market. These two should stay on their own sides of the balance sheet.
(See Disclaimer in the footer.)
Consider if a homeowner is laid off or disabled and cannot pay their bills. Under a traditional mortgage, typically after 120 days of being overdue, the bank will start the foreclosure process. Try even renting a place with no income and having been recently evicted from a home. What's a family to do?!?
With the Revolving Account, the homeowner's only obligation is to pay the interest. That means that as long as they still have equity, they can continue to pull monthly withdrawals to keep the home, put gas in the car and food on the table.
Living off of the equity is an undesirable Long-Term plan because the homeowner is increasing what they owe on the house. It is, however, much more merciful than losing the home at such a critical time in one's life.
Having the built-in buffer will provide time for the family to either get back on their feet if the situation is temporary or to sell if the situation is permanent and to do so from a position of strength rather than desperation.
People with fluctuating incomes love this strategy. The historical experience in these homes is feast-to-famine, roast-to-ramen.
We will coach the bill payer to use a fixed amount needed to live on, even if they didn't make enough that month. The next time they get paid more, still only take what is needed to live on. We ask homeowners not to spend more just because they made more.
As long as the household is spending less than they are making over the scope of the year, this process will not only work to pay off the home more quickly, but levelize their household budget.
Account holders have 100% access to your cash.
We utilize Revolving Accounts. By definition, they are revolving, which means that money can go in and money can come out, anytime, any day, all day long. The account owner does not need ask to anyone permission to access their cash. They simply transfer the funds out just like any other account.
There are no penalties for overuse and no punishments for underuse. These are not considered "structured." They are flexible and open. This allows the homeowner to flow their monthly budget through the program with ease and then to pull the money out for future purchases, emergencies and regular expenses.
For the purposes of paying down debt, we are reaching you through our marketing efforts, sharing with you our tools and resources, having several meetings running through your numbers to ensure accuracy of the recommendation, producing easy-to-understand reports that takes you step-by-step through the math and logic, providing a video library to train you how to navigate through the process, introducing you to one of the of the few banks that qualifies to do a program like this, assisting with ongoing coaching through complex situations to ensure your greatest chance of success.
We are also licensed to assist with any other financial planning needs. In this case, we may introduce you one from our advisory group to provide focused and specialized service.
Although there are different methods we use within our goal of paying off the home in record time, it typically includes a revolving credit account. These were nicknamed the "Australian Mortgage" because of the continent that first used these. We will at times refer to them as an "Open Mortgage."
Regardless of what the institution calls the account, the concept of Revolving Credit Mortgages have been around for decades. Certain banks have been using them with this strategy since 2004 in the United States. Australia, New Zealand, the UK and Canada have been using them significantly longer.
The concept of the Revolving Mortgage or Open Mortgage provides more freedom to the consumer because they are able to flow 100% of their savings and income through the loan. Everyday it sits in the account, it reduces the principal and interest whereby shrinking the principal balance considerably.
There are only a few banks that qualify to work for this program. More importantly, most do not know the strategy; they only have a product that works for the process. In most cases, the banks do not understand how this works. This is why we are clear that we do not work for the bank and the bank does not endorse us. We are separate entities operating within the spheres of our authority.
Through the constant application of marketing efforts, we have reached the homeowner to share with them this amazing strategy. Half of the benefit is knowing this is a real thing.
Through the process of meeting with them, we will analyze the homeowner's financial numbers and calculate when they will be 100% debt-free. We will provide the introduction to the bank and direct them how to start the application process. We will open to the applicant the entire course library of videos, spreadsheets, checklists and other tools to optimize their debt destruction. We will have several one-on-one meetings that take the applicant step-by-step through the math and logic to ensure they know how to navigate the process. We are with the borrower until you are 100% debt-free of current debt. We will be there to assist with ongoing coaching through complex situations to ensure their greatest chance of success.
We are also licensed to assist with any other financial planning needs. In this case, we may introduce clients to one from our Advisory Group to provide more focused and specialized service.
A fixed-rate mortgage ( FRM) is a fully amortizing mortgage loan where the interest rate on the note remains the same through the term of the loan, as opposed to loans where the interest rate may adjust or "float".
Revolving credit is a transactional bank account. The borrower may use or withdraw funds up to a pre-approved credit limit. The amount of available credit decreases and increases as funds are borrowed and then repaid.
Temporarily depositing cash into a loan to reduce the amount owed, whereby decreasing interest paid.
The legal practice of placing expenses on a credit card during the period when no interest charges accrue and then paying it off prior to interest charges or late penalties.
A period in which a debt is reduced or paid off by regular payments.
Annual or annualized percentage rate, typically of interest on loans or credit.
Here's a great definition on Bank of America's website. Clicking here will take you there. (Don't forget to come back!) https://bettermoneyhabits.bankofamerica.com/en/home-ownership/mortgage-debt-to-income-ratio
Here's a definition of Loan to Value (LTV) on Investopedia Bank of America's website. Clicking here will take you there. https://www.investopedia.com/terms/l/loantovalue.asp
Total interest paid is calculated by subtracting the loan amount from the total amount paid.
These allow you to use money in linked mortgage accounts to effectively reduce (offset) the amount you owe and, therefore, the interest you pay each time. Used wisely, they can save money and help you repay your mortgage faster.
With these you don’t repay any principal, you just keep paying interest on the full amount each time. Interest-only loans are usually available with a fixed or floating interest rate.
Securities and Investment Advisory Services offered through The Leaders Group, Inc. Securities Dealer, Member FINRA/SIPC; TLG Advisors, Inc. Registered Investment Advisor; 26 W Dry Creek Circle, Suite 800, Littleton, CO 80120. 303-797-9080. Fire My Mortgage® is not affiliated with The Leaders Group, Inc. or TLG Advisors, Inc. Doing the right thing is always the right thing! TM