Article Presented by:
Jeff Spellman
Many homeowners often feel that they will never actually get their mortgage paid off in full. Part of the reason for this is that the traditional mortgages are set up for a 30-year time period. Picturing life a full 30 years from now, or even 10 years from now may seem a bit overwhelming for many people.
Imagine what it would be like if you could pay off your mortgage sooner than anticipated. Sure, we all think about it, we tell ourselves that next year we will start paying more than is required each month, or that once we pay off the car loan, we can put more money to that mortgage.
Unfortunately, many homeowners never seem to have that extra money to put towards their mortgage payments. These same people are able to afford their mortgage payments each month, but just never seem to have anything left over at the end of the month to put towards an overpayment on the home loan.
If you are looking for a way to pay off your mortgage quicker than the original terms of the loan, then there are certain things that you need to understand.
First of all, the lender wants you to take the full 30 years to pay off the house because the lender is earning interest from you during that time period. If you pay off the loan sooner than expected, the profit to the lender will be reduced. Because of this, most lenders are in no hurry to educate you about the methods that you can use to achieve an early pay off.
Next, it is important that you understand that the lenders use what is called amortization to set up your repayment plan. In this amortization the lender allocates where the money that you pay each month goes. By this I mean that the lender allocates a percentage of your monthly payments towards interest, and the bulk of the remainder goes towards your principal.
In the beginning of the repayment period (first few years of the loan), the bulk of the money that you pay the lender each month will go towards the interest. The lender wants to make sure that they get their profit from you as quickly as possible, in case you default on your mortgage. If you were to pay the lender back, at the exact rate they set up in the amortization schedule, 99.5% of the final payment that you make to the lender would go towards the principal. Conversely, roughly 85% of the very first payment that you make on your house will be allocated to interest.
With amortization schedules, a homeowner can realize huge savings on the amount of interest that they pay the lender if they make a few changes in their payment methods. One of the changes that you can make is to make bi-weekly payments on your mortgage instead of monthly payments. No, you do not have to pay twice the amount of money; you simply pay half of the payment after two weeks, and the second half of the payment two weeks later.
An example of this would be if your monthly mortgage payment is $1,500, you could pay $750 bi-weekly and save a huge amount of money on the interest of the mortgage. In context, a homeowner can literally save between $30,000 and $100,000 in mortgage interest by making bi-weekly payments instead of monthly payments. Every person's experience will vary, but the average homeowner could save $60,000 in mortgage interest, all without a need to refinance his or her home loan. The bi-weekly payment system is perfectly legal, and it could pay you handsomely for your extra efforts. These kinds of savings are possible, because of the way the lenders use the amortization schedule and the way that they allocate the money that is paid to them.
Another reason bi-weekly payments help save you a considerable amount of money on your mortgage interest is because you would actually be making 26 payments each year, or in other words you would be making 13 months worth of payments annually. Right there you have found some of that "extra" money that you never seemed to be able to come up with that you wanted to put towards your mortgage. In reality, you will be making one extra monthly payment, but since you will quickly become accustomed to paying a smaller payment every two weeks, it won't be as big of a shock to your wallet as if you tried to come up with an entire extra monthly payment all at once.
By considering some of these very simple changes in the way that you repay your mortgage, you could own your home quicker, establish equity faster, and reduce the interest that you pay to the lender by thousands of dollars.
It is recommended that you consult a financial advisor, or other expert to learn which repayment methods would be best for you and current situation. They will be able to show you, via an amortization schedule, exactly how the money would be allocated and how you can start saving money today.
About the Author:
Jeff Spellman is a financial-services specialist. Jeff established JS Real Estate Solutions (http://www.jsrealestatesolutions.com/) to help real estate investors and homeowners enhance their investments, protect their assets and maximize their returns. If you would like to save interest on your mortgage, build equity in your home more quickly, and even pay off your mortgage years ahead of schedule, Jeff can help. Please visit http://www.jsrealestatesolutions.com/mortgagereduction.html to learn more. Jeff can be reached at: 516-808-4105 or jeff.spellman@jsrealestatesolutions.com
12.19.2006
Want to sell more online? Give less choice!
Article Presented by:
Peter Koning
In the 1990's it was common for online businesses to load up their sites with one or more menus having a rich choice of options and content for visitors to dive into.
It was thought that by giving as much information such as white papers, case studies, technical details, benefits, reseller sales material, and so on, that the visitors to the site would eventually find what they needed and make a purchase.
But today site visitors are less patient than ever. It's been found that the average visitor will click away from your site in less than 3 seconds. Also, we all know how much information overload we have in our inboxes and download folders.
So websites that give so much information and choice to the visitor are actually under-performing compared to sites that guide the visitors along a path towards a specific goal, such as signing up for a free report, coupon, or to place an order.
"Information overload is a critical and consistent problem, and in this study we found that Web users were more likely to say that a site had too many links as opposed to too few links," said Jeff Rosenblum, co-founder and research and strategy director of Questus, in January 2006
Recently a discussion on choice has surfaced on the internet.
Marketing Experiments recently discussed the pros and cons of having choice on a website. According to a seminar they gave in October, 2006, "Too many choices fragment a prospect's attention. In a split test, we simplified from 3 columns to 1, the subscription process from 2 pages to 1, and reducing the number of subscription options from 3 to 2 resulted in conversion rate increasing 42% and revenues more than doubled."
Also a recent excellent article by Dr. Ralph Wilson discussed the differences between a "linear" site - very little choice, guiding a visitor along a path to the goal, and a "menu" site lots of options and choices, navigation to reach all over the site.
He doesn't judge one better than the other, but it's obvious there are some things we can learn from linear sites and possibly adapt our overly choice-rich sites to guide our visitors along a path to buying, more than we may have in the past.
A linear site will get you fewer sales of other products, but you'll get more sales of the products you are offering to the prospect. This implies that if you are selling one main product, you should have a linear sales process to optimize your conversion.
Dr. Ralph Wilson's bottom line on conversion potential is that a Linear Site has higher conversion potential because of specific focus, perhaps lessened somewhat because of limited choice of products. A Menu-driven Site has lower conversion potential because of greater shopper freedom, perhaps raised some because of product choice. You can pick any of thousands of vendors and see how they have so many options on their site it's not funny.
Want to see a linear site?
Go to any internet marketer's site they know how to turn visitors into hot prospects and then into customers. Most internet marketer sites are simply a sales page with an order button, and maybe one link for affiliates to learn how they can promote the product.
Internet marketers have learned by testing and measuring, that it is better to grab a visitor's attention, pull them into the site, and present the benefits in a direct fashion.
Using a linear site and other internet marketing techniques, a pair of internet marketers recently sold over $10 million of StomperNet a Search Engine Optimization membership site, in 3 weeks.
More and more online shoppers are getting used to seeing sites with less choice and so this concept is becoming more accepted.
Websites from the 1990's need to consider updating their marketing strategy to use this concept, which to most internet marketers is obvious.
What about your site?
Visitors to your site have come there for a reason.
If your site is wide open and offers them everything they could possibly wonder about, that's great but is it presenting it in the right order to lead them to an action such as buying your product?
Probably not, since people tend to hop all over a site and without any persuasive message the odds aren't good that they will take action.
People like to be led so why isn't your website doing that?
It's a well known fact that people will find excuses not to buy something even if they were perfectly qualified to. For example, if one sales page gives the option to buy, but has links at the bottom to various other areas of the site - .vs. another sales page having just a couple of purchase options, which do you think will perform better?
So try removing some of the choice from your site, and think of guiding your visitors in – maybe offer an opt-in page which then leads to more information. By pulling your visitors into a funnel you will be able to measure each step along the way, and also build a relationship with your prospects at the same time.
About the Author:
Peter Koning has over 20 years of experience in IT sales and marketing, has studied the latest sales techniques of internet marketers, and is the founder of http://www.ViralSalesGenerator.com a viral marketing platform for online merchants.
Get a free 30 page report on Viral Marketing at http://www.ViralSalesGenerator.com today.
Peter Koning
In the 1990's it was common for online businesses to load up their sites with one or more menus having a rich choice of options and content for visitors to dive into.
It was thought that by giving as much information such as white papers, case studies, technical details, benefits, reseller sales material, and so on, that the visitors to the site would eventually find what they needed and make a purchase.
But today site visitors are less patient than ever. It's been found that the average visitor will click away from your site in less than 3 seconds. Also, we all know how much information overload we have in our inboxes and download folders.
So websites that give so much information and choice to the visitor are actually under-performing compared to sites that guide the visitors along a path towards a specific goal, such as signing up for a free report, coupon, or to place an order.
"Information overload is a critical and consistent problem, and in this study we found that Web users were more likely to say that a site had too many links as opposed to too few links," said Jeff Rosenblum, co-founder and research and strategy director of Questus, in January 2006
Recently a discussion on choice has surfaced on the internet.
Marketing Experiments recently discussed the pros and cons of having choice on a website. According to a seminar they gave in October, 2006, "Too many choices fragment a prospect's attention. In a split test, we simplified from 3 columns to 1, the subscription process from 2 pages to 1, and reducing the number of subscription options from 3 to 2 resulted in conversion rate increasing 42% and revenues more than doubled."
Also a recent excellent article by Dr. Ralph Wilson discussed the differences between a "linear" site - very little choice, guiding a visitor along a path to the goal, and a "menu" site lots of options and choices, navigation to reach all over the site.
He doesn't judge one better than the other, but it's obvious there are some things we can learn from linear sites and possibly adapt our overly choice-rich sites to guide our visitors along a path to buying, more than we may have in the past.
A linear site will get you fewer sales of other products, but you'll get more sales of the products you are offering to the prospect. This implies that if you are selling one main product, you should have a linear sales process to optimize your conversion.
Dr. Ralph Wilson's bottom line on conversion potential is that a Linear Site has higher conversion potential because of specific focus, perhaps lessened somewhat because of limited choice of products. A Menu-driven Site has lower conversion potential because of greater shopper freedom, perhaps raised some because of product choice. You can pick any of thousands of vendors and see how they have so many options on their site it's not funny.
Want to see a linear site?
Go to any internet marketer's site they know how to turn visitors into hot prospects and then into customers. Most internet marketer sites are simply a sales page with an order button, and maybe one link for affiliates to learn how they can promote the product.
Internet marketers have learned by testing and measuring, that it is better to grab a visitor's attention, pull them into the site, and present the benefits in a direct fashion.
Using a linear site and other internet marketing techniques, a pair of internet marketers recently sold over $10 million of StomperNet a Search Engine Optimization membership site, in 3 weeks.
More and more online shoppers are getting used to seeing sites with less choice and so this concept is becoming more accepted.
Websites from the 1990's need to consider updating their marketing strategy to use this concept, which to most internet marketers is obvious.
What about your site?
Visitors to your site have come there for a reason.
If your site is wide open and offers them everything they could possibly wonder about, that's great but is it presenting it in the right order to lead them to an action such as buying your product?
Probably not, since people tend to hop all over a site and without any persuasive message the odds aren't good that they will take action.
People like to be led so why isn't your website doing that?
It's a well known fact that people will find excuses not to buy something even if they were perfectly qualified to. For example, if one sales page gives the option to buy, but has links at the bottom to various other areas of the site - .vs. another sales page having just a couple of purchase options, which do you think will perform better?
So try removing some of the choice from your site, and think of guiding your visitors in – maybe offer an opt-in page which then leads to more information. By pulling your visitors into a funnel you will be able to measure each step along the way, and also build a relationship with your prospects at the same time.
About the Author:
Peter Koning has over 20 years of experience in IT sales and marketing, has studied the latest sales techniques of internet marketers, and is the founder of http://www.ViralSalesGenerator.com a viral marketing platform for online merchants.
Get a free 30 page report on Viral Marketing at http://www.ViralSalesGenerator.com today.
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