Mortgage accelerator

Mortgage accelerator

A mortgage accelerator is a specialty mortgage loan that combines the characteristics of a checking account with the characteristics of a home equity line of credit. The borrower deposits regular income into the account, which immediately reduces the loan balance. Monthly expenses are paid out of the account, and these increase the loan balance. At the end of the month, any deposited amount that's not withdrawn to pay expenses, goes towards the loan balance as a principal repayment. Over time, the borrower accrues interest more slowly, and is therefore able to pay off the debt balance more quickly.