First-of-its-kind home loan designed to help reduce interest costs
and pay down mortgages faster
MINNEAPOLIS--(BUSINESS WIRE)--
Ameriprise Bank, FSB, in partnership with CMG Financial Services, Inc.,
today announced the launch of the Ameriprise Home Ownership Accelerator®
loan product. This new home financing option replaces a traditional
mortgage with a combination of a home equity line of credit and a
checking account which together can help a borrower use idle cash to
reduce interest costs and pay off the loan balance years early.
The largest source of regular income for most people is their salary,
and their largest expense is typically their mortgage payment. The
Accelerator works by syncing the two. Homeowners deposit their paychecks
into a checking account which is linked to a home equity line of credit.
Cash left in the account at the end of each day is swept into the line
of credit, driving down the principal balance on their loan and
subsequently lowering the amount of interest owed. Homeowners can
withdraw money to pay bills and cover everyday expenses, just as they
would with a traditional checking account. The more money they leave in
the account at the end of each day, the more they will save in interest.
The effect compounds month after month by maintaining positive cash flow
and lowering the average daily balance on the loan. As the principal is
paid off, the amount of interest owed diminishes. In this way,
homeowners can save substantially on interest and pay off their home
loans years early.
The Ameriprise Home Ownership Accelerator Simulator (ameriprise.com/accelerator)
offers a side-by-side comparison between the Accelerator and traditional
mortgages. Unlike other programs that allow borrowers to make
supplemental mortgage payments to pay down their balances faster, the
Accelerator provides the flexibility to access their funds as needed by
drawing against their line of credit. While relatively new in the United
States, this type of lending solution is popular in the United Kingdom
and Australia.
“From a consumer’s perspective, this is a new way of thinking about the
home borrowing experience,” said Jeff Williams, president of Ameriprise
Bank, FSB. “When evaluating a traditional mortgage, borrowers tend to
look at two things—the monthly payment and the interest rate—without
considering the overall cost. Many would be astonished by how much money
they’ll spend on interest over the life of their home loan. With the
Accelerator, the equation changes. The homeowner’s idle cash is applied
to the principal balance first, lowering the amount of interest they
owe. This built-in flexibility puts homeowners in charge so they can pay
off loans as quickly and efficiently as possible—all without changing
their spending habits.”
The Ameriprise Home Ownership Accelerator is available through select
Ameriprise Financial advisors and is ideally suited for clients with
positive cash flow, sound credit and strong money management habits. The
Accelerator is not available in all states. More information can be
found at Ameriprise.com/accelerator.
About Ameriprise Financial
Ameriprise
Financial, Inc. is a diversified financial services company serving
the comprehensive financial planning needs of the mass affluent and
affluent. For more information, visit ameriprise.com.
About Ameriprise Bank, FSB
Ameriprise Bank, FSB, an Equal
Housing Lender and Member FDIC, provides deposit, lending and personal
trust products to Ameriprise Financial Services, Inc.Ameriprise Bank
and Ameriprise Financial Services are subsidiaries of Ameriprise
Financial, Inc.
Home Ownership Accelerator is a trademark of CMG Financial Services Inc.
Product offered and copyrighted materials presented with permission.
U.S. Pat. No. 7,627,509.
Brokerage, investment and financial advisory services are made available
through Ameriprise Financial Services, Inc. Member FINRA and SIPC. Some
products and services may not be available in all jurisdictions or to
all clients.
© 2011 Ameriprise Financial, Inc. All rights reserved.
Source: Ameriprise Financial, Inc.
Contact:
Ameriprise Financial, Inc.
Media Relations:
Kathleen
McClung, 612-678-1069
kathleen.h.mcclung@ampf.com