Learn about Interest Cancellation:

At the Debt Free Project we believe the first step to maximizing the power of your money and controlling debt is to learn the concept of "Interest Cancellation". In our My Debt Edge™ Advanced Credit Strategies workshops, "Interest Cancellation" is the first thing we teach.  "Interest Cancellation" is a new paradigm in financial management and is not taught widely by most financial professionals. Why? Honestly, we don't really know. Maybe it's because the companies who supply financial services and products (investments, insurance, loans, etc) are more interested in you accumulating small amounts of interest which helps them generate profits than they are in showing you how to pay less in interest. We're starting to see the trend switch among many fee based providers, and for that we're glad. Just know that your financial expert may not be teaching this concept, or might not even know about it. The basic idea we have with regards to "interest cancellation" is that for people with debt, interest cancellation is more valuable and more powerful than interest accumulation.

It would take much too long to describe this on a web page so we've created a short video.  Click here to watch the video (it's free) of how the principle works.

Don't quite grasp the concept yet?  That's ok.  It takes many people several times of watching the video before the idea starts to sink in.  After all, it's probably quite different from anything most of us have previously learned regarding finances and financial management.  Feel free to watch the video as many times as you need.  Once you understand the basic idea, there are a couple of things you'll need in order to use this strategy.

You must be able to qualify for or already have a Line of Credit (Home Equity, Personal, or Business). The LOC must have some specific features. Click here to get a printable document which will show you what the LOC Characteristics must be in order to be compatible with the interest cancellation strategy. You can print this form and take it to your lending institution to be sure that the Line of Credit you get will work with the interest cancellation strategy. If you need a lending resource to get your LOC we have several that we can recommend.  One of the online sources we like is Lending Tree Home Equity Loans. At Lending Tree, national lenders compete for your business and you'll receive up to 4 offers.  Again, just make sure that the Line of Credit has the features listed on the LOC Characteristics form.

A word of caution with regards to using the interest cancellation strategy.  For many people who are not disciplined, having money available on a line of credit is dangerous because it's easy to justify spending it.  Don't!  Spending too much from your line of credit will put you further in debt and in a terrible financial situation.  It will also negate the benefit of the interest cancellation effect.  It's great to have the credit available in case you need it for emergencies, just be cautious.  To best use this strategy, make sure that you are living by your budget.  Your budget should show your discretionary income (money that is not spoken for at the end of each month).  Your goal should be to reduce the balance on the line of credit each month by the amount of your discretionary income.  In essence, to maximize this strategy, your discretionary income should be considered as the amount of your payment towards the line of credit each month.  Need more clarification?  Sign up for our free My Debt Edge^TM E-Newsletters or contact us via email, comment card or telephone.  As always, discuss any financial strategy with your personal financial adviser who can advise you on your particular financial situation.

Now that you are familiar with how interest cancellation works, find out how powerful it can be.  Go to the next step to learn how to put this strategy to work against your biggest debt and the one you'll pay the most interest on, your mortgage.  You may find (like tens of thousands already have) that you can potentially save thousands in interest and years in mortgage payments with little or no change to your lifestyle using just your current income.