Method 3: Live Off an Interest-Free Card. 7 Ways To Pay Your House Off Fast

Ok! Method number three of seven to smash a loan is to live off an interest-free card. Why on earth would you do that? We’ll explain.

Firstly, how do interest-free cards work?

Remember, most credit cards offer up to 55 days interest-free. Some might be less, and some might work on different billing cycles so be sure to check with your bank before implementing this method.

The key words here are “UP TO” which means that you can make purchases on the card from the 1st to the 31st of the month and on the 1st of the following month you’ll receive a bill from the credit card company. They’ll give you until the 24th of that month to make the repayment before they will begin charging interest. You then do a sweep on the 23rd to pay off the credit card and avoid any interest.

Why should you go through the trouble of using a credit card to pay your bills? This goes hand-in-hand with Method 2: washing your wages through your loan. While you’re living off of your interest-free credit card, all your real cash is sitting against your mortgage, reducing your interest even further. Thus, helping you pay off your loan faster since more money is going towards the principal and less towards the interest.

Now, we have heard of people using several interest-free credit cards in a cascading manner to achieve this on a larger scale. One card pays off the next and so on to buy as much time as possible before your real money goes out the door. I must stress that we DO NOT recommend that strategy. It may sound fun in theory, but a potential disaster in practice. Plus, having too many cards chews up your borrowing capacity.

The easiest way to manage the repayment of the credit card so that you don’t get caught out paying it back too late is to set up what’s called an “auto-sweep”. On your designated day each month, the bank automatically debits your nominated account for the exact money owed on the card from the previous month. Simple.

Another nice little advantage of living off the interest-free card, is you rack up a lot of frequent flyer miles (if your card has that feature, of course) and that can equal a free trip interstate a few times a year, or the odd business class upgrade.

This strategy does make a difference in the life of a loan, but if you are useless with credit cards and lack the discipline to do this properly, DO NOT use this strategy. Also, keep your limit as low as you can. Just enough to cover a month’s worth of transactions. Excessive credit card limits are a big trap and chew up your borrowing capacity to buy more properties. This is ultimately where you’re going to make your millions – owning several properties instead of just one in the next boom.

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– Integrity Team

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