Check out Stephen’s thought-provoking take on this often overlooked idea and see how you could save thousands (…and years) through a simple yet different understanding of financing.

Transcript:

Welcome back this is Steven Libman we’re shattering the illusion surrounding money and have you challenge your relationship with money so that you can have more today what am i going to be talking about let’s see i’m going to be talking about a mortgage and i’m going to break it down into two words the first word m-o-r-t mor which means death and the second word which is g-a-g-e which means pledge look it up it’s root french so wait a second the word mortgage comes from originally a foreign language that means a pledge for death uh yeah it really is two french words and the pledge dies when the obligation is paid or the property is taken back very simple but the question is why do we get mortgages i mean think about it i know why most people get mortgages but the short answer is because that’s how we’re conditioned that’s what everybody tells you to do if you buy a house get a mortgage it’s really that simple but why don’t we ask for other options well we don’t ask for other options because that’s how we’re conditioned we’re conditioned not to ask and if we don’t ask for other options we certainly aren’t going to get any so the question becomes why does it matter well it matters because you’re likely taking longer than you have to and paying much more than you need to to pay off that death pledge right

Imagine what the cost is now i’ve done this calculation for people a few years ago and i would share with them when they were doing some personal coaching with me at some point and i would pull out a calculator mortgage calculator and i would simply compare using a mortgage to using a line of credit now you might think well they’re both financing at about the same rate and that’s true but one is a re-advancing line of credit and the other one is an amortized loan and the advertised loan is far more costly regardless of what the interest rate happens to be and it is likely costing people at least tens of thousands of dollars more than it has to and in some cases hundreds of thousands of dollars if you happen to have some of those higher end mortgages so the cost to you by not knowing is a fortune and i want you to remember that because it’s so expensive there’s even a cliche out there that says ignorance is bliss and the truth is ignorance is expensive because now that you know this you know to start asking what are my options it’s not always a mortgage oh sure sometimes that’s the best idea but oftentimes they’re better solutions with that in mind come back next time for another edition of let’s look at your money right and let’s see what we can learn and help you have more of it until then all the very best