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If you own a home, have just re-financed or are shopping for a mortgage, you’ll be outraged.
Housing: Americans across the country were shocked to hear of a new poll that states 97% of homeowners here in America are overpaying millions of dollars each month in mortgage interest.
The National poll was conducted last month to determine how many homeowners take advantage of the prepayment loophole in our mortgage system, which eliminates costly interest overpayments.
The shocking results showed only 3% of America’s homeowner population utilize this loophole and take advantage of the valuable benefits created by it.
The problem lies with what the banking industry calls “front loading”. This is when the majority of a homeowner’s payment is applied towards the interest on the loan instead of the original amount borrowed.
The disturbing fact about front loading is it ensures you’ll pay over three times the original amount borrowed. Thus, resulting in enormous profits coming straight out of your pocket and directly into your lenders.
… Most people (97%) never stop and take a good look at how damaging the system really is. Unfortunately, it’s just the way conventional mortgages are structured here in
America.
Average Homeowner overpays $60,000
In fact, the average homeowner in America is overpaying $2000 in mortgage interest every year, or $60,000 over the life of the mortgage.
“That’s an enormous amount of money”. Says top mortgage analyst, Craig Romero. “This is money that homeowners are needlessly giving away each year. Imagine what a person could do with an extra $60,000.
While gaining back thousands of dollars from these overpayments is a huge benefit, it’s not the only one. Cutting up to 10 years from the term of a traditional mortgage is also another major advantage.
Americans must understand this prepayment loophole isn’t something lenders are eager to share with their customers. If they did, they would risk taking a huge cut in profits.
With over 50 million mortgages in force, it’s estimated Americans overpay their lenders in excess of $12 billion every year. It’s no wonder this loophole is kept secret…lenders are undoubtedly getting rich off these interest
overpayments.
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