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He’s working with the banks. 🥱

I think one key item not mentioned is that once your cards are maxed or above 33% utilization your FICO score will drop most likely below 700 into the 600’s. At this point NO bank will give you a loan to consolidate your cards, and be left with the consolidated loan. The bank/peer to peer lender/etc. cannot force you to pay your credit cards and close them, thereby only having one loan to pay. As a result the banks will not give the consolidation loan! Also if you try to refinance your own home, but your score is low because of the credit cards, then the bank will NOT let you cash out refi because the FICO is lower than 700’s everyone in the banks expects. So you can see the desperation the person in debt has! No way out, unless you can sell your house or can get a 2nd job that pays well enough to allow you to get ahead and not burn out because you are working and barely sleeping!

I think one key item not mentioned is that once your cards are maxed or above 33% utilization your FICO score will drop most likely below 700 into the 600’s. At this point NO bank will give you a loan to consolidate your cards, and be left with the consolidated loan. The bank/peer to peer lender/etc. cannot force you to pay your credit cards and close them, thereby only having one loan to pay. As a result the banks will not give the consolidation loan! Also if you try to refinance your own a home, but your score is low because of the credit cards, then the bank will NOT let you cash out refi because the FICO is lower than 700’s everyone in the banks expects. So you can see the desperation the person in debt has! No way out, unless you can sell your house or can get a 2nd job that pays well enough to allow you to get ahead and not burn out because you are working and barely sleeping!

I regret paying off my home said noone.

For those of us who have been responsible with money, we only have mortgage debt. And yes, putting cashflow directly into the mortgage is the fastest way to pay it off. VB is for people who need debt consolidation as a second chance to correct their bad spending habits.

Mortgage payment is favoured for another reason for shorter term mortgages like 10 years. In 10 years there is a big big chance the s and p will be leas than 10%. It might be negative or slightly positive. If your mortgage is long term, then investing probably makes sense. But paying mortgage down faster just seems so much safer

I think you forgot something on the PLOC. You no longer have a car loan of $286 (but a PLOC) which will add to your cashflow of $1619 now making the cashflow $1905. The car loan is paid in full and gone. Your "All Cash Flow" on the PLOC will make it better than an extra payment. I went out 4 months on the "real" PLOC cashflow and even using your higher interest balances and got: Month 1 $10589 vs $10870 Month 2 $ 8784 vs $9344 Month 3 $ 6965 vs $7805 Month 4 $ 5132 vs $6275. That's a difference of $1143! It would actually be a little lower because I used your interest numbers. $286 additional cashflow X 8 months is $2288 difference (not -$352). The power of using a LOC vs a loan. Especially an amortized mortgage. EDIT: I went to six months and it came to a balance of $1410 leaving less than a month to pay it off. You actually are paying it off in 6+ months.

Great presentation...I wish I knew this when I got the mortgage. Thank you Sir...

One question. If it doesn’t work why are so many people using successful to pay off debt before the loan term?

Everyone buying a home should see this. I’ve known this strategy for over 15 years and I’m shocked by the number of people who just pay their monthly payment. Another money saving tip; pay off your credit card balance(s) every month, and don’t buy anything with a credit card that you can’t afford to pay cash for at the time of purchase. Third; contribute to a 401(k) every paycheck, even if it’s only a small amount. You’ll be amazed at how much you can save over 30 or 40 years with compounding interest. So many young people starting a new job after college don’t understand this. I have saved so much money with these simple rules.

Sadly, banks continue to stumble, mortgage rates is on the rise with higher imports and lower exports, yet the FED is to lessen cost. So, where do we grow and safeguard our money now? something will eventually break if they keep raising interests and quantitative tightening.

Who in rhe world would have a 2% car loan smh

I Always try to pay extra on mu principal even if 10 $

Ss5s😮

Velocity banking is how you oay off your mortgage soooo much faster.

A mortgage of 250,000$?? WHAT YEAR IS THIS!? Ah! Those were the days... if only!

He obviously doesn't understand velocity banking. Funny how everyone in her comments explains how well velocity banking works for them. This guy doesn't even explain the different types of interests which can be daily. So velocity banking most definitely helps.

I pay approximately $37/week extra on my home loan plus I add $50 here and there where I can. In addition I pay an extra $2k every six months when I get my bonus. I’m hoping it’ll all add up to being able to pay the mortgage of on approx 20 years

I used velocity to pay off my 36 mo. car loan in 14 months. I mean it worked for me. I'm sure it doesn't work for all but the math proves it.

Your video came directly on the heels of a velocity banking video (I didn't know it was velocity banking at the time). I'm so glad I saw this. You explained it very well - even for me, who has a hard time with financial topics.

I'm sorry but you don't seem to understand how velocity banking works, at least not the way Christy Vann teaches it. In the first example, the goal of using the cc initially isn't to necessarily pay off the card but free up money (cash flow) by basically eliminating that payment. Yes, you still have to pay the interest which may be anywhere from $80-200+ but you'll skip the full payment. So, instead of a $400 payment like I had with one of mine, you can knock it down to $100 payment, thereby freeing up $300. The goal is to increase cf and using the extra cf to pay things down. Plus, in your example, you're right, it would be minimal gain but most people have several years left on their debts and thus this would not help much. In the HELOC example, it seems you don't understand how amortized payments work. Yes, technically the mortgage is 5% but that's not the true rate; it's more like close to 100 which means you're paying for almost another house in interest alone. By making large chunk payments you move further ahead on the schedule, thereby eliminating a lot of the interest. The point is to create cf by paying off debts, and then you create more cf as you go, increasing the "velocity" of the payoffs. Again, dumping your check into the HELOC satisfies your monthly payment, minus the interest, which is nominal. I started vb in November and we've paid off two cc's, back taxes, and a collections we had, freeing up about $700 a month. I also pay some bills through another low interest cc, freeing up another $250.

The issue is that either the renter or the owner must in some way pay insurance and property taxes if they want a "permanent roof" with utilities like electricity, gas and water. Because of this, many people-at least in California, where I currently reside-are living in tents. No taxes, rent, mortgages, or insurance. The number of people who tell me they live in their car that I meet amazes me. Its crazy out here!

Is this calculation apply for same fixed & variable interest ( I mean paying 100 or 200$ more every month ) calculation or is it only for fixed interest !!??

No one in debt is going to have a car loan interest rate of 2.5%. Why not be more realistic with an interest rate that actually exists of 15%-21%.

I would not do that. I rather split payments and make every two weeks. Secondly pay lump sum of yearly and reamortize the loan: which will reduce payment also and you will be able to save more for next year.

How about if you use a loan or card with zero percent interest?

Way too conservative.

v simple, straight forward information withot trying to sell anything. thanks

thank you for creating and uploading this analysis.

This guy doesnt explain this correctly at all lol

A couple years ago I had the opportunity to make a cash offer on a house, but it would have required me to drain almost all my liquidity, and that would have felt terribly unsafe. I took out a 30 year mortgage instead and I feel much better with it than I would have felt with only a six month emergency fund to protect me.

This guy just wants to keep everyone in the loan scam created by the banks to keep the banks rich. Establishment banker

❤❤❤❤

Spot on information and very enlightened video. Thank you so much..

Simple rule 1. Don't take credit cards 2. dont take Mortage. 3. Don't drink 4 Don't smoke.

Very good thanks

Thank you Good information.

With this, I'll say that Investing is mostly about behavioral psychology. Rule 8 indicates you don't need a high IQ to be a good investor, just 2 qualities, self discipline and a lot of patience. How can I generate more income to retire with at least $3m for long term care?

I have always been scared of debt and hated the idea of interest No way was I buying a house and taking 20 or 30 years to pay it off No way So I left school got 2 jobs Lived off my evening job and saved 100 percent of my day job Living with parents it was easy Gets to 25 years old Buy a a nice 3 semi in nice area and puts 50 percent deposit down , next 5 years contained to have 2 jobs Lived very very frugally And paid the mortage off in 5 years and was mortage free aged 30 Now 52 and been rent / mortage free for 22 years Great feeling when many people I work with are paying 500 . 1000 or even 1500 a month mortage What would have been my mortage payments been getting ploughed into my pension And I’ll retire at 55 very very comfortably

I really appreciate this video. I have watched quite a few of the pro velocity banking videos and even infinite banking videos. They never sat right. I knew something was off. Begging for Peter to pay Paul. And juggling acts. Math doesn’t lie. I felt so safe here on your channel and I trusted you. I am thankful for your calm demeanor that was objective and fact based-not emotionally driven. No hype, just truth. I loved all the different scenarios you gave as examples. Thank you so much for the no nonsense explanation!

I think the more efficient way is to get a side hustle and use all that extra money you earned from your side hustle to pay down your mortgage debt.

Best simple explanation ever ! You earned my support ! Thank you sir !

VB works

Ooff 3 things here- 1. You didn't even mention debt that the example person may have. 2. You didn't mention the very popular 0%APR that most who utilize velocity are focusing on (Because of the debt) 3. Most people are broke because they don't know how to plan financially. Regardless of whether any method saves or costs money, it helps to teach the individual HOW to prioritize spending which is generally not something that immediately correlates with age or any other factor. I don't have debt and I have never used an velocity method, but I see the advantage of people who have crippled themselves financially having a hand to hold onto.

Thank you for speaking in a way that a slow math guy like me could understand.

I believe in velocity banking. It works!!!!

You are amazing! Thank you very much for being generous with your knowledge. This is a life skill that everyone should know. Managing their finances.

"I've been the CFO of several software companies." Bruh can't hold a job. Bet he got a good buyout though. Smart bruh for sure. Good job, Andy.

Bought our house Dec 2016 30yr mortgage and paid it off Sep 2020.

Love it