The Homeowner Accelerator

How this differs from a normal HELOC

A normal HELOC is a second mortgage. You keep your existing loan and the line sits behind it. The Homeowner Accelerator takes first position. It is your mortgage. There is no separate first loan underneath it.

That single difference changes what it can do. You can buy a house with it, not just tap equity in one you already own. You can refinance into it, replacing a conventional mortgage entirely. Your whole balance sits in one line rather than split across a fixed loan and a revolving one.

And interest accrues on your daily balance. Deposit your paycheck into the line and your balance is lower until you spend it, which reduces interest while it sits there. That is the accelerator idea. Used deliberately it can shorten the life of the loan considerably. Used carelessly it is just a mortgage with a variable rate.

Why we do not publish a payoff example

How much this saves you depends entirely on your income, your monthly spending, your existing debts, and how you actually use the line. No two situations produce the same result.

A generic illustration would be worse than useless, because it would either overpromise or understate depending on who is reading it.

What we do instead is run your actual numbers through a simulator before you commit to anything, so you see what it does for your situation rather than someone else’s.

Who this suits, and who it does not

It fits someone with meaningful income flowing through their accounts each month, who is organized about money, and who wants their cash working against the mortgage balance rather than sitting in a checking account earning nothing.

It does not fit someone who wants a fixed payment they never think about, or who is tight month to month with little cushion. The rate is adjustable, there is no escrow account, and a line of credit you can draw on is a temptation as well as a tool.

The no-escrow point cuts both ways. You keep control of your tax and insurance money through the year, but you are also responsible for having it when the bills arrive.

Qualifying on assets, at a far better ratio

This is the most valuable and least known thing about the product. If you have substantial assets but limited documentable income, this program divides your eligible assets by 120 months to calculate qualifying income.

For comparison, Fannie Mae uses 360 months and Freddie Mac is moving to 180. At 120, the same assets produce two to three times the qualifying income they would on a conventional loan.

A simple illustration of the arithmetic: $600,000 in savings and money market counts at 100%, so $600,000 divided by 120 months is $5,000 a month of qualifying income. On a conventional loan dividing the same money by 360 months, it would be $1,667.

Under 65, checking, savings, money market, and CDs count at 100% while stocks, mutual funds, and retirement accounts count at 70%. At 65 and over, everything counts at 100%.

One rule to know: assets already producing income you are using to qualify cannot also be depleted. If you are drawing a monthly IRA distribution and counting it as income, that IRA cannot also count toward depletion.

You can have more than one

Up to three Homeowner Accelerator loans, one each on your primary residence, a second home, and an investment property, up to $3.5 million combined.

That is unusual, and for someone building a portfolio it is worth understanding early rather than discovering later.