The All-In One Mortgage: Combining Equity Line of Credit and Bank Account

All-in-one mortgage

Update: All-In One Mortgage - 2021.08.05

A mortgage is the most important investment for your family’s future that should be taken care of with great responsibility and caution; because it affects not only just today but tomorrow also. So when someone considers buying a house or apartment, they need to think twice about their budget before making any decision blindly!

All-In-One Mortgage is an increasingly popular type of loan that combines Mortgage, Home Equity Line of Credit (HELOC) and bank account in one. This type of mortgage offers several benefits, such as lower interest rates and increased liquidity. It can act as both Mortgage and Savings Account. In this blog post, we will look at the All-In-One Mortgage from both sides to see if it’s right for you!

Benefits of All-In-One Mortgage

Use Extra Cash-Flow to pay off your mortgage faster

Whenever money is coming into your account it is applied against the principal. Since interest is generated daily, you are reducing your overall interest rate.

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Liquidity

The extra principal payments that were made can be accessed again.  HELOCs have a variable interest rate and the HELOC balance will fluctuate.

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Lower Interest Rate

The All-In-One Mortgage offers an adjustable interest rate to keep your payments fixed, even as rates change or you make additional principal payments.

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Access to Money Easily

If you need to access money in case of emergency you don’t have to apply for a new loan. You can access up to the amount of overall credit available quickly.

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All-in-One Mortgage Return on Deposit

Compared to typical savings accounts the APR on the mortgage is higher. Since you are reducing your principal with your extra dollars, in a way you earning more as compared to keeping your money in CDs or savings accounts.

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All-In-One Mortgage Details

  • All-In-One Mortgages require a FICO score of 700+ with an annual fee that ranges from $50-$100 depending on your creditworthiness.
  • You can get up to 30 years at an adjustable mortgage rate.
  • They usually have higher APR rates than traditional mortgages.
  • You could pre-pay some of the mortgages to reduce your APR
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Who is this suitable for?

  • Have steady cash flow every month
  • You are concerned with paying it off your mortgage faster
  • You might need to access funds in the future
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All-in-One Mortgage vs. Traditional Mortgage 

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Traditional Mortgage:

Lower APR over a longer period of time

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All-in-One Mortgage:

Higher APR over a shorter period of time (if you don’t make money out for emergencies).

Deciding between the two is a matter of weighing your needs, and deciding what time frame you are looking at. A regular mortgage might be a better choice if you don’t need access to funds for emergencies or have excellent credit.

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Other Options:

HELOCs can also be used in other ways as well: such as consolidating debt that’s spread out from different sources or starting up new businesses with low initial costs (i.e., home business).

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Conclusion

If you are looking for more liquidity in your finances, this might be a good option! But there is no perfect type of loan or mortgage so it’s important to understand ALL pros and cons before making any decisions. Most importantly how it applies to your particular situation.

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