So today we're talking about accelerated methodologies for how you pay off a mortgage. And I'm gonna show you four different ways to do that. Like if you wanna accelerate and get that house paid off, I'm gonna tell you that my whole journey of buying thousands of homes began with my fascination of the fact that I was on the phone doing telemarketing in college, talking to people who had gone to college, followed society's plan, and then got a house.
And you could tell that the, the burden of like owning a house worth having hundreds of thousands of dollars of debt, it bothers people, right? It's like the biggest payment in your life. And so I noticed that a lot of these people 20, 30 years later with refinancing and restructuring the loan, they weren't getting their houses paid off. And they're at some point you get old enough where it's like, this is like a, a weight and this is a pressure. So as a young man in my early twenties, I'm like, there has got to be a way to get this house paid off quicker and faster. So I am gonna share four methodologies with you today. And with that we're gonna get right to it because we're gonna be legend here.
It's about to be legendary. So come on into my secret lab that isn't so secret, but it is my studio. And what we're gonna do here is I'm gonna kind of throw up on the board what these four options look like and um, break this down for you. So Chris, you might be asking, what is the most traditional way that people go about paying something off? Option number one is that when you get a house, the typical mortgage in America is what's called a 30 year fixed mortgage.
And What a 30 year fixed mortgage is, is basically it's a bank saying, oh, we're lending you money and let, let's just use round numbers. You, you're buying a house for $300,000 and you're thinking to yourself, all right, what's it gonna take for me to pay off this house? The bank says, well, we'll help you pay it off in 30 years. But it's not just taking 300,000 and dividing it by 30 years of mortgages. You're actually gonna pay for that house like two and a half times over and the bank is gonna make all that money and interest. And I don't wanna go into too much of that detail 'cause I think it's a little bit boring, but I want you to understand that the bank wants their money if they're gonna work with you for that super long period of time. Now, the way that they do this is they basically say, oh, 30 year fixed mortgage, here's your payment.
And if you make that payment every month for a year, that's 12 months. If I do it for 30 years, it's like 365 payments. And if I were to do that for 30 years, the bank would get all of their money back a couple of times. Plus you'd get own the house free and clear. Free and clear means you have no more mortgage on it, you got no more payments and you own it. Here's the funny thing about this. What you need in your thirties when you buy a house is what you think you'll need in your fifties or sixties. Dude, probably not. You might have kids, you might have to move, you might get job changes, you could move across the country, you may have to downsize, you might need to upgrade. The reality is no one keeps a 30 year fixed mortgage. And here's the problem.
The banks front load all of the money they get in the beginning. So if I had a payment of let's say $1,500 a month, like 80 bucks is going towards the principle, the rest is going towards interest and the bank knows this. They know that there's a high likelihood you're gonna move or change your life in the next seven to 10 years. So basically almost all the money that you're paying on this 30 year mortgage goes to who? The bank. So you're not even paying the house down hardly at all. It sucks, but it's true. And if you're the kind of person that's like, actually Chris, I've got a pretty boring predictable life and not much
is ever gonna happen to me and I'm not really gonna go places, and what I want today is what I want 30 years from now. If that's you, then something like this might work.
But for you to actually gain the bank at this system, you'd have to hold onto that mortgage for at least 25 years, sucks. So then you start saying, you know what? I am now aware of that Chris, there's gotta be a better way, a faster way to pay off my mortgage. And you know what they do? The bank said, you know what, for those of you want to be more aggressive, to be more conservative. So we're putting those two words together. We're inventing something called the 15 year mortgage. And here's the way the 15 year mortgage does. You're not gonna pay so much outta interest, but you're gonna have a much higher payment. So instead of a $1,500 a month payment, maybe your payment is $2,200 a month. And guess what? You only have to pay it for 15 years. And some of you're like, Hey, this is fantastic.
It's not fantastic. You're gonna bleed more cash flow, you're gonna put more money into the house, and what you're really doing is investing in your house. Problem is your house doesn't pay you anything. It's a liability. Even though it'll appreciate with time and the value will go up and you'll look back at some point and be like, wow, I have so much of my assets and net worth in my house. This was a great decision. You'll have done it the most inefficient way possible. If you want the bank to win, play their games. I don't like the bank to win, I want to win. I, I'd like everyone to win, but the bank here is gonna collect so much money off of you. It's ridiculous. And if your life changes in the next three, four, or five years, you're not gonna really reap the benefits of that.
But more importantly, you don't have as much free cash flow because you're dumping it from your own pocketbook, you're dumping it back in the bank as if it's an investment. It's not an investment. Then you say, alright, I wanna do something even more aggressive. That's it. You're like, you know what? I don't want the bank to win. So you know what I'm gonna do? I'm gonna get on either a 15 or a 30 year mortgage, but what I'm gonna do is I'm gonna throw extra money at the bank. If my payment's 2000, I'm gonna pay 2,500 this month. And why are you doing that? Because you wanna pay it off quicker and add more principle, which means you're gonna pay less in interest. Problem is you're still playing the bank's game. Now, I do have an option that I do believe in. It's not one of these three, and at this point you might be wondering what it is.
And my friends, this is why you're watching the video and that's why you've gotten to this point. It's for this moment right here. So I'm gonna give it to you. I'm gonna tell you however, that it's different than what most people think. I don't believe in ownership, I believe in control. And while I can't control people, I can control money to some extent. I wanna kind of break that down for you. Being a young man and realizing, oh my gosh, paying off my house is like, it's one of the hardest things to do. It takes so long. What's a faster way? Instead of putting extra money in the bank, take that extra money. And option number four is put the difference into an investment property investment real estate. Imagine for just a moment, if you bought a house that had at least a 20% annual R O I, and let's just say that instead of paying down that house more or putting a bigger down payment on it, let's say that you put $40,000 down on a 200,000 house that represents, by the way, about a 20% down payment.
And it's like I could take that 40 grand and put it in my house and pay off my primary residence sooner, but instead, you know what I'm gonna do? I'm gonna take that 40,000, I'm gonna put it into an investment property, and if I'm earning a 20% r o i, here's the question, how long does it take for me to double my money? 1, 2, 3, 4, 5 years. 20%, 20%, 20%, 20%, 20% adds up to 100%. 1, 2, 3, 4, 5 years. So just imagine for a moment that you could double your money every five years if you could do that. Then
five years later, 40,000 has become what? Well, it's become 80,000, but five years later, 80,000 has become what? 160,005 years later, what does it become? It's become $320,000. Now, by the way, we did this in 15 years just by buying one investment property, you could freaking pay off your house right now and have leftover money to invest.
Let me share with you the scenario. I find people in all day long, and this is how I've helped people really grow themselves. I'll find people that own a house already. It's a primary residence and they've got some equity into it. Let's say it has a value of $300,000. That's what, that's what it is worth in today's marketplace. But what they owe is $150,000. Now, if your house is worth 300 K and you owe 150 K, then how much equity do you have? Equity means the difference between what you owe and what it's worth. So this is the V for value. O is for owing, and we're gonna use E for equity, and the equity is also 150,000. If I take my equity and when I own and add it together, I get the value of a home. So what can I do with this equity of $150,000?
Well, most people can go to a bank, borrow up to 80 or 90% of the value on their home. In this situation, probably free up about $80,000. Now, the bank will let you actually borrow that. It's called a home equity line of credit, or you could just refinance the house. The bank gives you 80 grand 'cause they're like, dude, this is an asset. You have this money. What could you do with 80,000? Now first of all, you're thinking, Chris, I'm freaking trying to actually like pay off my house. Like if I pull 80 grand out, guess what? I don't owe 150 anymore. Now I owe 230 grand like I'm freaking going into debt.
This is not the plan. Watch one step backwards might mean 10 steps forward. This 80,000 is enough to buy what two homes. If those homes are earning 20%, then in five years, I can turn my 80,000 into what? 160,000 by year 10. If I turn that Into $320,000, what can I do with that $320,000? I can pay off my house, I can have leftover money, and I did it in 10 years. I didn't do it in freaking 20 years, and it'll be even faster than that. When you actually look at the compound interest effect, today's video, I wanted to kind of open your mind and let you know there is a smarter way, there's a better way. But you gotta be thinking, how do I access homes with a 20% r o I? Well, most of my homes have a 25, 28, or a 30% R o i, which means I can double my money sometimes every three years. If you'd like to learn more about that, couple of things. One, I highly recommend that you actually get a copy of this book. I'm giving it away to you today for free. There's a link below.
This book will share with you exactly how I do that, and there's another link below, maybe a more important link that says, partner with Chris. It'll take you to a page where I'll show you my track record on my last 4,000 homes, and I'm also gonna share with you how I get 25 to 30% ROIs. If you like what you find there, you can talk to my team and I can actually show you how to pay off your home, not only a lot faster, but more importantly, create the real dream, which is not a paid off home. It's called financial freedom. And I don't mean financial freedom is like I'm rich, I'm a billionaire. What I really mean is getting un mortgaging your life, not just your house. How do I live life on my terms? How do I get the residual income I need to get my time back and and do the things that I want with who I want when I want?
I figured all that out by the age of 26, and now I've been able to magnify it and take it to a whole new level. We got this one life to live. Don't let the banks own it. Don't play the bank's games. Their games take so freaking long. The reality is there's a better way, a smarter way, a faster way, and frankly, a safer way. So do yourself a favor. Pay off your house the most intelligent way possible. My name's Kris Krohn. I hope you enjoyed today learning about the four different ways to pay off your house. Links are below
to learn about how you access my deals, earning 25 to 30%, or how you can get a free copy of my book. Either one of them can be super helpful on your journey of figuring out how to become financially free and take total financial control over your life. If you're brand new to the channel, make sure you subscribe. I got new videos coming out every day to teach you how to be your own financial genius. Take care.