Everything You Need to Know About Getting a G.O.A.L.
Galaxy's Ownership Accelerator Loan or GOAL is a 30-year first-lien HELOC (Home Equity Line of Credit) connected to a sweep-checking account. This combination functions as one powerful financial tool that can be used to reduce interest and accelerate your payoff by actively managing your cash flow through the account.
In a traditional fixed mortgage, interest is front-loaded. This means in the early years of the mortgage term, a higher portion of every payment is going towards interest than what is being applied to the loan balance. With GOAL's structure, interest is calculated on the daily loan balance. As deposits go into the sweep-checking account, they are applied directly to the loan balance, reducing the interest.
This is largely dependent on your specific situation. Factors like income and spending habits play a significant role so the results will vary based on each person's financial profile, their goals, and how they control the use of this loan. Qualified candidates can typically pay off in half the time or less compared to their traditional mortgage.
Deposits made into the connected checking account are applied to the loan balance automatically every night through a feature known as a sweep. The funds remain accessible just like a regular checking account but while they are sitting in the account not being spent, they are reducing your loan balance therefore reducing your interest during that time.
Interest is calculated daily and totaled once the month ends. The daily interest charge is calculated by multiplying the loan balance by the fully indexed interest rate and then divided by the days in the year. The total interest from the month becomes the interest payment, which is charged to the line of credit automatically.
By connecting the sweep-checking account and line of credit together, a direct relationship is formed between your dollars earned and your dollars owed. The deposits reduce your loan balance which reduces the interest. Idle cash is now saving you more in reduced interest than it likely would have earned sitting in a checking or high-yield savings account. This has a compounding effect that can produce substantial interest savings and results in your principal loan balance being reduced faster than a traditional fixed mortgage schedule.
The line of credit is available to draw from for 30 years. The approved credit limit remains unchanged for the first 10 years, then reduces by 1/240th each month for the remaining 20 years. This structure keeps the line of credit liquid and available for use for an extended period, allowing for payoff without losing access to the home's equity.
This is an adjustable-rate mortgage, and your rate will be updated monthly. The rate is the sum of the margin and monthly index. The margin is fixed and you will lock this in is during the loan process. The index may adjust monthly.
The index is based on the 30-Day Average SOFR (Secured Overnight Financing Rate) value published on the last business day of the prior month. For example, if the last business day of May is the 29th, then the published 30-Day Average SOFR for May 29th will be used for all of June.
Yes, there is a maximum-rate cap as well as a floor-rate. The maximum-rate cap is determined at closing and equals 6.000% over the initial rate. The floor-rate is determined by the occupancy of the home; primary and secondary residences have a floor-rate of 3.750% and investment properties have a floor-rate of 4.750%.
The GOAL program isn't structured like a traditional adjustable-rate mortgage which amortizes your payments and principal reduction. Because this loan focuses on positive cash-flows, it is designed to lower your principal balance and reduce interest, even if the rate rises. The key to lowering the interest spent on borrowed money is to reduce the amount owed and the time spent in the debt.
No, You may pay off the balance at any time without penalty.
The loan process is like any other mortgage loan. You will work closely with one of our Loan Officers to review your financial profile, answer your questions, and determine whether the GOAL program aligns with your financial goals. Our team will guide you every step of the way.
Yes, the GOAL program can be used to purchase or refinance a primary, secondary or investment property.
Yes, this loan can be closed in an Inter Vivos Revocable Trust that meets eligibility requirements. Trusts are reviewed for approval prior to the loan closing.
If the balance has been paid to zero, the line of credit remains open and available for use for the remainder of the term. You can request the account to be closed, however. Additionally, If the line of credit is not used within a 12-month period, the servicer will notify you of the inactivity and that they may close the account if it remains unused.
The loan servicer will issue a 1098 for mortgage interest each year. The mortgage paid may be eligible for deduction. Please speak with a tax professional for advice.
The sweep-checking account comes with all the same features that you're already accustomed to, including ATM Debit Point-of-Sale VISA cards, personal checks, online and mobile bill-pay, external account transfer, direct payroll deposit, mobile banking app, downloadable monthly statements, and more. It is a complete checking account.
Yes, all borrowers on the loan will receive access to the account and may add authorized users once the account has been set up.
You will start to receive information regarding your new account after closing. Bank cards and access to the account online and through the mobile app is included in information packets mailed by the servicer. This set up can take 4-6 weeks to be fully complete.
Yes, the sweep-checking account is FDIC insured.
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