Velocity banking can work, but it requires mortgage payoff to be your primary focus. The more positive cash flow you have each month, the faster you can pay off your mortgage. But that assumes that you're putting all of your excess cash towards your mortgage, which means you can't use it for anything else.
Velocity Banking Cons
Accessing a line of credit can lead to more debt. Essentially, it's a slippery slope. If you have an income change like a job loss due to the pandemic, this can go sideways quickly as you tap into the line of credit to fund your life… Having access to your equity can increase purchasing.
Velocity Banking — also known as the “HELOC Strategy” — is a personal finance approach that uses a home equity line of credit (HELOC) to leverage disposable income to pay down your primary mortgage while saving the amortized interest.
It's easy — Zelle® is already available within Velocity Credit Union's mobile banking app and online banking!
Velocity Banking is risky and doesn't put you in control, while Infinite Banking maximizes your control. The result of Velocity Banking is putting all your cash flow into home equity.
Velocity Payment Systems is a payment processing company that is run by a subsidiary company of First American Payment Systems called Govolution, LLC. The company began in 1998 and specializes in electronic payments that meet and evolve with security standards.
Using a HELOC for Mortgage Payoff
Once approved for the HELOC, the homeowner can draw on the credit limit to pay off the mortgage. Then the homeowner makes the payments to the HELOC rather than to the mortgage. This can boost cash flow thanks to lower payments, while also saving on total interest.
Yes, velocity banking can help increase your home equity. But that's not savings, and you might not always be able to access it. The problem here is that for money to truly count as savings, it must have maximum liquidity and safety.
A line of credit (LOC) is an account that lets you borrow money when you need it, up to a preset borrowing limit, by writing checks or using a bank card to make purchases or cash withdrawals. Available from many banks and credit unions, lines of credit are sometimes advertised as bank lines or personal lines of credit.
For many people on a shoe string budget the infinite banking concept can be cost prohibitive. Although there is no set minimum monthly payment, in order to truly follow this concept and see its fruit you would need to try and put around 10% of your income into your policy, or at least $300 a month.
Meet Infinity, Queensland's first neobank set to shake up Aussie banking. Yet another neobank is set to launch in Australia in 2020 and this one promises to shake things up with alternative product offerings for future customers.
Making additional principal payments will shorten the length of your mortgage term and allow you to build equity faster. Because your balance is being paid down faster, you'll have fewer total payments to make, in-turn leading to more savings.
In this scenario, an extra principal payment of $100 per month can shorten your mortgage term by nearly 5 years, saving over $25,000 in interest payments. If you're able to make $200 in extra principal payments each month, you could shorten your mortgage term by eight years and save over $43,000 in interest.
Every week, it seems, comes a new report of someone scammed out of thousands of dollars. And now Congress is starting to ask questions. That's because while Zelle is an easy way to send money, it is also an easy way for scammers to steal your money.
Who Owns Zelle? Zelle is a product of Early Warning Services, LLC, a fintech company owned by seven of America's largest banks: Bank of America, Truist, Capital One, JPMorgan Chase, PNC Bank, U.S. Bank and Wells Fargo.