Did you know that over 80% of Americans are in some form of debt? Mortgages are by far the most popular type of liability. Depending on the type of product you find, a mortgage can either be a smart investment or a massive cash hole. So, how do you find the right option for you?

Simple: by understanding the different types of mortgage options available. For example, an all-in-one mortgage is a great option for people who want to pay off their mortgage faster while tapping into their home equity.

If you want to learn more about an all-in-one mortgage, then you’re in the right place. In this article, we’ll be diving into whether or not this type of mortgage fits your needs. Let’s get started!

What Is an All-in-One Mortgage?

When you break it down, an all-in-one mortgage is essentially combining three elements into one: a checking and savings account, a mortgage, and a HELOC (or home equity line of credit). Why combine these elements? Well, it allows the homeowner to do two important things.

One, they can pay off their mortgage more quickly in the short term. You can also withdraw any savings that you put into your mortgage. This is beneficial because it allows for people to cut down on the interest they owe. Second, they can have access to any equity that’s built into the property. This ideal for attaining a line of credit for things like medical emergencies and home repairs. 

What Are the Advantages?

As we mentioned, the biggest advantage of an all-in-one mortgage is that it decreases the amount of interest you owe over the lifetime of your loan. You also get limitless draws into your mortgage home equity (as long as you pay them back on time). However, these two perks aren’t the only benefits that come with this unique type of mortgage. Here are some of the other perks that come with an all-in-one mortgage:

  • Simplifies by combining all accounts
  • Provides a higher rate of return
  • Puts every dollar you make toward your mortgage
  • Offers instantly liquidity if you need it for an emergency reason
  • The monthly payments are more flexible
  • You can reverse the mortgage at any time

If you want to learn more about all the benefits that come with an all-in-one mortgage, then make sure to check out our full guide here

Refinancing vs All-in-One Mortgage

Refinancing occurs when you ask your bank for a new loan that equals the amount that you currently owe. Why would you do this? To cut down on the large interest rates that came with your original mortgage and pay off your loan more quickly. Unfortunately, refinancing isn’t always the right financial decision.

Many banks add on fees whenever you decide to refinance. So, instead of saving you money, it can cost tens of thousands of dollars throughout your mortgage lifespan.

An all-in-one mortgage, on the other hand, allows you to gradually decrease this interest cost without having to refinance. That being said, there are some scenarios where refinancing just makes sense. If you’re going to refinance, then make sure to check out our tips beforehand. 

How to Tell Whether an All-in-One Mortgage Is Right for You

An all-in-one mortgage isn’t for everyone. So, how can you tell whether or not it’s right for you? Simple: by reading this section. Here are three things that every homeowner should have before committing to this type of mortgage. 

1. You Have Good Credit

Before providing all-in-one mortgages, most lenders will want to make sure that the applicants have a dependable credit history. After all, most lenders allow for limitless draws from the home equity line of credit. As such, they want to make sure that you pay back any withdrawals completely and promptly.

Applicants with a good credit score are much more likely to find lenders who are willing to take them on. Most of the time, you will need a FICO score of 700 or more to qualify for an all-in-one mortgage. Loan amounts are available up to $2,000,000.

2. You Have Financial Discipline 

It’s important to remember that all-in-one mortgages are intended for people who spend less money than they earn. Unfortunately, the draw of limitless equity can be too enticing for some people without financial discipline. If you continually draw upon your equity, then you risk extending the duration of your mortgage considerably.

As such, if you have difficulty with saving money, or spending too much on credit, then we don’t recommend an all-in-one mortgage. Self-control when it comes to unnecessary purchases is important for making this option work. 

3. You Want to Pay off Your Mortgage Quicker

Going through all-in-one mortgage lenders can shave years of time off your mortgage period. Not only that, but it can also cut down on the amount of interest you owe throughout the loan’s lifespan.

Remember that interest is calculated using the total amount of savings in your account. The more money that you deposit, the more you will save. As such, it’s ideal for people who have extra money at the end of the month that they want to put toward shortening their loan. 

Tired of Limited Loan Programs? Contact Ascend Mortgage

We hope this article helped you learn whether or not an all-in-one mortgage is a right option for you. Even if you aren’t completely convinced about an all-in-one mortgage, it’s important to have different options when it comes to loan programs. Unfortunately, if you’re going through your bank, then you’re likely getting a limited selection of loan options.

Luckily, mortgage brokers, like Ascend Mortgage, can help you out. Unlike your bank, which represents a single lender, we’re able to work with multiple programs and lenders to bring your mortgage that’s tailor-made to your needs.

Not only that, but we’re quicker too. We close an average of twenty-nine days sooner than the average lender. If you’re ready to learn about how Ascend Mortgage can help you today, then get in touch with us as soon as you can.