Wednesday, February 11, 2009

My Mortgage Company and How It Loves Me

Got a notice from First Horizon about how I could SAVE $80,069.80 on my mortgage! Isn't that sporting of them to look out for me in this way?

All I gotta do is sign up for the "Equity Accelerator Program." That's where they deduct my mortgage payment right outta my checking account every two weeks. They'll take a teeeeeeeny bit more than half of my monthly payment every two weeks. That teeeeeeeeny bit more, $8ish, won't hurt a bit and will add up so niftily that I'll save tons of interest over the course of 29 years. I'll have more equity in my house sooner and pay that much less -- $80,000! Isn't that swell? I feel so loved and nurtured by dear old First Horizon. Some MBA works there and came up with this beautiful program to help simple people like me.


As it happens, I can read tiny letters as well as the bold print. In the tiny letters they mention that they'll charge me a one-time $49 Enrollment Fee. Oh, and a monthly Participation Fee of $9.00. Not sure why, since I could set this payment schedule up all by myself with my bank's online payment service, which costs me not a thing ($0).

It also happens that I have an MBA of my own in the house. Well, my husband has one, but he's in the house with me having it. And he's clever enough to notice that it's not the leeeeetle monthly increase in the payment of $8ish. It's that by paying every two weeks (26 payments per year) instead of monthly (12 payments per year) we'll end up making three payments some months. That'll hurt, especially since we only get one paycheck a month. It's those two extra payments per year that make the real difference in the faster interest paydown, not just the $8/mo increase. That part I might not have noticed by myself. Gotta fight MBA-think with MBA-think.

Imagine going to grad school and then getting a job coming up with near-scams like this for a living. How demoralizing that must be, poor soul.

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