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Equity Management

Bi-weekly payments can save you many years off your mortgage; for loans in Wisconsin and California, contact Michael Creed today

As I am sure you know, for years – forever, really – lenders have been programming you and I to pay our loans they way they want us to. They want our debts to be paid over the maximum term because they want to make the most amount of money possible from the debtor. This debt is the result of purchasing such things as a new home, car, boat or school loan.

Yes, Envoy Mortgage is a Lender, that is true, but as your advocate, I also want you to know there is a better way. That solution, noted below, is a great tool to help you save for many years to come.

The solution to this issue is an Equity Building System (EBS) offered through one of our business partners. The EBS is based on the sound financial concept of making one extra payment, per year, to principal. This is accomplished by systematically collecting ½ of your monthly loan payment every other week. Since there are 52 weeks in the year, this totals 26 half-payments. The 26 half-payments are the equivalent of 13 full-payments, with the extra payment being applied directly to principal. This simple concept can save tens of thousands of dollars over the course of your loans and it’s not very hard on the budget either.  The best thing is that our business partner does all of this work for you; they combine state of the art technology and great customer service to make these savings a reality. The name of our business partner is GemCap Equity Management.

Check out the most commonly asked questions and then contact me to get the ball rolling on this for your loan:

Do I have to close a mortgage with Envoy Mortgage to take advantage of this service?

No, our business partner works with EVERY mortgage servicer.  I simply collect data from you specific to your mortgage (payment address, amount, etc) and we take it from there.

How does the EBS Work?

The Equity Building System (EBS) is based on the simple concept of making one extra payment, per year, to principal. This, in turn, will reduce the total amount of interest paid over the course of the loan. We accomplish this by systematically collecting ½ of a loan payment every other week. Since there are 52 weeks in a calendar year, this totals 26 half payments. The 26 half payments are the equivalent of 13 full payments, with the “extra payment” being applied directly to principal. This simple concept significantly reduces the total amount of interest paid over the course of the loan.

How much will my total interest savings be with the EBS?

The amount of interest savings varies, depending on the terms of the loan. You can get a customized savings analysis sheet by contacting me directly. The following is a typical example of the interest savings:

Regular Loan Terms
Loan Amount: $150,000
Interest Rate: 6%
Loan Payoff: 30 years
Monthly P&I Payment: $899.33
Interest Saved: $0
Payments Saved: 0
EBS Payment Program
Loan Amount: $150,000
Interest Rate: 6%
Loan Payoff: 24.7 years
Bi-weekly Payment: $460.62
Interest Saved: $33,983
Payments Saved: 64

For more details on this analysis, contact me and I can get you a personalized example that contains all of your numbers – for free!

All calculations are for illustration purposes only. GemCap Equity Management, Inc. does not guarantee these exact savings and is not liable for Lender inaccuracies. These calculations do not include standard processing fees.

What happens with “Escrow” payments?

It is common practice to send money above the normal loan payment to your lender for the purpose of paying taxes and insurance premiums. These funds are deposited into an escrow account, from which the taxes and insurance are paid when due. With the EBS program, this extra amount will also be applied to principal once per year. This extra amount enhances the interest savings, equity buildup, and reduction of the loan term. It is very important for you to keep GemCap Equity Management, Inc. informed of changes in your escrow payments.

It’s common for your taxes and insurances premiums to increase from time to time. If we are not informed of changes, the required monthly payment may become deficient and create avoidable problems.

How will my funds be collected?

The EBS electronically debits your bank account through the Automated Clearing House (ACH) system. This ensures the prompt and precise transfer of client funds. The Client enrollment form authorizes GemCap Equity Management, Inc. to debit your specified account. We monitor each client’s account to make sure that the fund transfer was successful. These funds are deposited in an FDIC insured bank. GemCap then draws upon this depository account to make your loan payment.

When will my loan payments be made?

Your loan payments will be made by the due date each month. One of the great benefits of our program is that you’ll never have to be concerned with coupons or monthly billings. It’s all automated! You must ensure that there are sufficient funds in your account on the scheduled debit dates of our plan.

If the transfer of funds did not occur because of insufficient funds, there will be a charge of $29 incurred on this same account. It is recommended that you have overdraft protection on your debited account to ensure that this charge is avoided. Once per year, the successfully collected “extra payment” is sent directly to your Lender and applied to principal. This “extra payment” occurs after the 12th month following the initiation of the plan. It is made in the same time frame in each subsequent year.

If you have requested applying extra amounts to your normal monthly payment, these funds are applied to principal at the end of the month in which they are collected.

What if I change bank accounts?

If you want to change the account from which GemCap Equity Management, Inc. is debiting, you simply need to notify us of this change. We will request a new voided check or deposit slip to ensure accurate account numbers. It is imperative that this information is communicated from the client to us. We would always like to avoid insufficient funds charges in all cases. Also, failure to notify us could cause loan payments to be misdirected or late.

What if I sell or refinance my property?

The great thing about our EBS program is that it is transferable for life. If you are planning to refinance or sell your property, you must notify GemCap of any change of loan terms or Lender. This is very IMPORTANT! In addition, loans are sometimes sold from one Lender to another.

If you receive any notice of change of Lender, please notify GemCap IMMEDIATELY. The EBS program is transferable to new loans at no additional cost. This benefit does not apply to clients who cancel the program.

What types of loans can I use the EBS program for?

The EBS program works with almost all types of loans or lines of credit. New home purchases, second mortgages, investment properties, RV’s, cars, boats, and credit cards are some of the common types. If you are not sure about your particular situation, contact our Customer Service Center.

Is there a restriction not allowing me to make a payment every other week?

Typically, most lenders will not accept anything other than, at a minimum, a full monthly payment; this is true with Envoy as well. If you send in a partial payment directly to your lender every other week, instead of going through  the EBS, your lender will likely reject the payment.  The EBS works by acting as an escrow account paying your mortgage monthly; once there are enough funds in the account to pay the full monthly payment, plus an extra bi-weekly debit amount (this usually occurs twice per year when there are three bi-weekly debits in the same month), then the EBS makes that payment and, in turn, boosts your equity.

Take Action!

Contact me to sign up for this service to to learn more about it.

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