Buy Your Dream Home
Some banks will let you purchase a new home with a First Lien HELOC, while some banks might have “Seasoning Requirements.” All that means is you might have to wait a specific period of time before a bank will allow you to have a first lien HELOC on the property. Seasoning might be one day or even 6 months, so make sure you ask your lender if they have seasoning requirements. Either way, you want to have a first lien HELOC on your home, and not a mortgage because The HELOC Cash Flow Strategy allows you to take advantage of the way a first lien HELOC calculates interest compared to a mortgage with amortized interest.
Pay Off Your Current Home
If you already own a home, you can replace your mortgage with a first lien HELOC to immediately start taking advantage of The HELOC Cash Flow Strategy. You will either need to have some equity in your home to do this, or you can put money towards the equity when obtaining a HELOC. Most banks require at least 20% equity but some will allow you to have 10%, which is a 90% Loan-to-Value. Once you have obtained a first lien HELOC, you will be able to accelerate paying down your total HELOC balance at a rapid pace.
Consolidate Debt
If you have enough available equity in your HELOC, you can use that equity to consolidate your debt to the HELOC, eliminating multiple interest payments you typically pay every month for things like high interest credit card, car loans and any other type of debt you may carry. When you consolidate debt and eliminate multiple payments, you instantly create greater cash flow every month, which ultimately works in your favor and helps to accelerate your debt repayment and wealth building. We teach you how to accomplish this as quickly as possible so you can start your journey immediately towards a debt-free life and building wealth.
A first lien HELOC is a multifaceted tool. One of the things we teach with The HELOC Cash Flow Strategy is that you will use your HELOC as your savings account and emergency fund. We teach you how to use this invaluable tool to manage your finances using strategic deposits and withdrawals each month, which ultimately can save you thousands of dollars of interest every month. That savings helps you accelerate your overall debt repayment and simultaneously helps you build your wealth.
Save Money
Investing
Once you have access to YOUR EQUITY with a first lien HELOC, you can use that equity to invest in things like real estate, the stock market or any other investment opportunities. When you have a mortgage, you DO NOT have access to your equity. The equity in your home is yours, not the bank’s, and you should be able to use it whenever you want, and for whatever you want. We always strongly recommend using your equity only for things that will help you build more wealth.
Countless Other Ways
There are countless other ways to use the equity in your home. However, having access to your equity is a great responsibility so having the discipline to use your equity wisely is one of the factors to ensuring your success with The HELOC Cash Flow Strategy. We always recommend never touching your equity for things like purchasing cars or going on vacations until you have a strong understanding of The Strategy, have built a lot of equity and are rapidly reducing your balance month after month.