Home / News / Loss Mitigation / Ameriprise Financial Launches Home Ownership Accelerator Loan
Print This Post Print This Post

Ameriprise Financial Launches Home Ownership Accelerator Loan

""Ameriprise Bank, FSB"":http://www.ameriprise.com, has partnered with ""CMG Financial Services, Inc."":http://www.cmgfs.com/, to launch the Ameriprise Home Ownership Accelerator loan product.

[IMAGE] Replacing a traditional mortgage with a combination of a home equity line of credit and a checking account, this new home financing option can help a borrower use idle cash to reduce interest costs and pay off the loan years early, according to a statement from the Minneapolis-based bank.

""From a consumer's perspective, this is a new way of thinking about the home borrowing experience,"" said Jeff Williams, president of Ameriprise Bank. ""When evaluating a traditional mortgage, borrowers tend to look at two things - the monthly payment and the interest rate - without considering the overall cost. Many would be

[COLUMN_BREAK]

astonished by how much money they'll spend on interest over the life of their home loan.""

The Accelerator works by syncing a person's salary with a mortgage payment, which is typically a person's largest expense. Homeowners deposit their paychecks into a checking account, which is linked to a home equity line of credit. Cash left in the account at the end of each day is moved into the line of credit, driving down the principal balance on the loan and lowering the amount of interest owed.

It works like a traditional checking account, and homeowners can withdraw money to pay bills and cover everyday expenses. The more money they leave in the account at the end of each day, the more they will save in interest.

""The homeowner's idle cash is applied to the principal balance first, lowering the amount of interest they owe,"" Williams explained. ""This built-in flexibility puts homeowners in charge, so they can pay off loans as quickly and efficiently as possible - all without changing their spending habits.""

According to Ameriprise, the Accelerator is ideally suited for clients with positive cash flow, sound credit, and strong money management habits.

While relatively new in the United States, this type of lending is popular in the United Kingdom and Australia. It is not available in all states.

About Author: Heather Cernoch

x

Check Also

Sagent Taps Former Mr. Cooper President for Executive Chair Role

Sagent has named former Vice Chair and President of Mr. Cooper Chris Marshall as its new Executive Chair, tapped to strategize the fintech provider’s cloud-native software platform.