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The one major factor that keeps most people in debt and paying off credit cards or making mortgage payments for 30 to 40 years is the ugly, but lucrative effects of compounding interest on loan balances. It is these balances where banks calculate interest and financing charges daily that keep you out of debt and financial freedom. This compound interest is what keeps banks and lenders out of business, but the good news is that you can use the same accounts that banks use to make a profit and turn the cards in your favor to help you pay off your mortgage or debt faster. This process can be accomplished by creating what is known as a fund consolidation account.
What is a fund consolidation account?
A money consolidation account is a system that can be used to reduce the daily balance on any loan which will have the effect of reducing the interest on the loan, which in turn will make it possible to repay faster due to less interest due and more money being applied to the principal. These accounts are usually set up using a HELOC line of credit or a home line of credit which is basically on the simplest terms a line of credit like a credit card secured against the equity in your home.
How does the Money Consolidation Account System work?
What happens when you create one of these accounts is that you start depositing money into a regular checking account. Then, you can transfer it to the merged account and tell it the amount deposited. You will then adjust each month depending on your situation, how much extra you should apply towards your mortgage or loan balance and start paying your bills as normal. The effect of using this system will lower the interest rate on a daily basis.
This system can be implemented using math and paper, but unless you are really good at math and keep perfect records, you are better off using software to calculate complex algorithms and keep records of your income and spending.
But I heard it was a scam…
Unfortunately, the money consolidation account system has gotten some bad press from people who don’t understand how it works or are just trying to protect their financial interests.
The actual concept of the system has been around for a long time and originated in Australia. It has been used by thousands of people around the world to speed up mortgage and early repayment of loans.
Part of the reason it gets such a bad rep is because one of the main promoters of the system is an MLM company called United First Financial or UFF and people associate MLM with ponzi schemes or scams, so many are quick to judge based on MLM’s model of distribution.
United First Financial is not the only company that provides the software needed to perform calculations. They charge $3,500 for it, but it can be purchased thousands of dollars less than smaller competitors using similar systems.
Final thoughts
There are some pros and cons to using a money consolidation account. Using simple math proves that the system works on paper with its ability to reduce interest, but for some people this may not be an option if they are unable to have strict control over money, especially if it is freely available to spend. For those who want to pay off their mortgage or debt as quickly as possible, and are disciplined enough to control their monthly budgets and cash flow, a money consolidation account should be an option on the table to consider if you’re interested. Mortgage acceleration or debt cancellation systems.
