What’s Your Favorite Debt Weapon™? Here’s mine…

Hello Cash Flow Community!

If you have been a subscriber to the VIP Financial Education YouTube channel for any amount of time, then you know one of our most talked about topics are Debt Weapons™.

The reason being... they work!

Debt Weapons™ are one of the single best ways to attack and eliminate debt quickly and efficiently. By turning the banks against themselves, you'll be saving tens to hundreds of thousands of dollars in future interest costs.

If you aren’t sure what a Debt Weapon™ is or need a refresher, then here’s a great video to get you back on track.

After many years of coaching students, members, and subscribers of the VIP financial education YouTube channel, there is one thing I know for sure…

Debt Weapons™ are ALWAYS evolving and changing!

That’s why it’s so important to subscribe to our channel for the most updated information on what’s working and what’s not.

Okay, so let's move on to what has been one of my favorite Debt Weapons™ in the past couple of years... the Home Equity Line of Credit or HELOC.

I personally have found them to be one of the most powerful Debt Weapons™ to have in your arsenal and today I want to share with you the 4 reasons…

Reason 1: They are 100% Liquid. 

Getting the cash from your HELOC is EASY. With just a few clicks on your computer or taps on your phone, you can transfer the money you need to your desired account. Many financial institutions will even offer check writing and/or debit card withdrawal capabilities from a home equity line of credit.

I also love the fact that you can pull the money out and put it back as many times as you'd like without any fees or penalties! (something we utilize in paycheck parking)

Reason 2: Useful Down Payment Option.

They are often considered eligible forms of down payment, so if you want to go out and purchase real estate you can use your HELOC as the down payment.

With a HELOC, you no longer have to wait until you have cash saved up for that pesky down payment, something that keeps a lot of people out of investing in real estate.

Reason 3: Low Interest Rates.

In today’s economic climate, HELOCs have very low interest rates. Coupling this with techniques like paycheck or rent check parking, you can avoid substantial amounts of long-term interest costs on things like your primary home, credit card balances and other loans you want to pay off.

Reason 4: High Loan-To-Value.

I have seen these loans being approved for anywhere from 80% to even 100% of the equity in your home. This high loan-to-value can give you access to a large amount of cash for immediate use to attack debt in a safe and efficient manner like we teach here at VIP.

Now, keep in mind that you do need to own a primary residence in order to acquire this specific Debt Weapon™ - a caveat some may see as one of the biggest downsides to a home equity line of credit...

Speaking of downsides, please be on the look-out for my next blog post where I’ll be detailing some of the disadvantages of HELOC’s. As I’ve said many times before, there’s no such thing as a perfect Debt Weapon™ - but this one is pretty darn close! 

Having a wide range of Debt Weapons™ available to you is by far the best approach. In other words… Diversify! Til next time…

Onward and Upward,

Matthew Pillmore and everyone at VIP Financial Education