Replace Your University CEO Michael Lush has a robust descriptor for mortgages: Financial crack. “The poor cannot afford them [mortgages], and the rich do not use them,” he quipped. 

He has the credentials to back that up. Lush worked in the mortgage industry for 17 years and, in 2014, started Replace Your Mortgage to teach customers how to use a first-lien position home equity line of credit (HELOC) to finance real estate. “We have [now] taught 8,000 students on the Replace Your Mortgage strategy,” Lush said. “Our typical client pays their home off in five to seven years, saving approximately $170,000 in interest payments.”

Lush’s inspiration came from a hedge fund owner that resurrected his employer years ago. Lush said he spent as much time with that individual as possible, trying “to get into his sphere of influence.” Then one day, that individual revealed his secret: “We do not do mortgages. We still use other people’s money, but we do it more efficiently. We use HELOCs.” Lush said he and a business partner spent 18 months trying to disprove that claim. They could not. 

An evolution of wealth and a wealth of ideas

As Lush’s clients began to reap financial success from the Replace Your Mortgage course, they came back with questions about what to do with their newfound capital. Lush had the answers, and those answers became packaged in additional courses under the Replace Your University umbrella: Replace Your Banker, Replace Your Employer, Replace Your Dollar, Replace Your Mindset and Replace Your School. In addition, clients learn about buying, building and scaling businesses, real estate investing, insurance investing, taxation strategies, day trading, mindset coaching, and homeschooling.

However, going back to the HELOC home purchase: What if a prospective homebuyer does not have a current home with equity? Doesn’t that first home purchase require a mortgage? 

“The equity piece confuses people,” said Lush. “You can buy a home with a HELOC. Your down payment is the equity, so [in a first lien position] you can buy a home with a HELOC without leveraging any other property. It requires a larger down payment, but HELOCs also do not have closing costs. A mortgage is a terrible form of financing real estate. It is archaic and inefficient.”

Lush sees being “strapped” to a mortgage as a form of “financial sabotage,” particularly when one considers that owning a home is one of the top pathways to wealth creation and generational wealth. “The modern-day mortgage concept is a product of the Federal Reserve System,” Lush explained. “The central bank forever changed the way we bank in America.”

Which brings us to Replace Your Banker – and ultimately, your life. 

“Banks are in the game of profit,” Lush said. “Replace Your Banker gets you off the community bank’s asset sheet by creating your own bank and capital resources. It then provides the resources for Replace Your Employer and investing in real estate to create passive income, which is then parlayed into Replace Your Dollar for higher yield returns. That higher yield allows families to invest in their children through Replace Your School, bringing values back into American homes and establishing a real-world educational system designed to prepare children to avoid the pitfalls we all made in the traditional systems.” 

And it all starts with …

“Replace Your Mindset. That is the foundation for all other successes to follow. Without a proper mindset, folks fall victim regularly to a limiting belief system.” Lush said that most people perform at a 20 percent capacity that “keeps them in a state of comfort.” “We show them what the world looks like after they push through their comfort zones and structure their days tackling hard things with a sinister smile,” said Lush. “Get your mind right, get your body right, get your family and friends right, get your faith right, and lastly, get your businesses right.”

Lush has several examples of client successes to prove his concepts. Some of them are now a part of the Replace Your University team. And they have frank but also encouraging advice for their clients, regardless of the economic climate. “Do not sit back and let external factors dictate your financial well-being,” he said. “We tell our clients that no one is coming to save them. Instead, they need to take ownership of their situations and create their own economy. Move from a scarcity mindset to an abundance mindset.”

And if they make a mistake? “Mistakes are feedback, not failures.” Absorbing that message will put you at the head of the class.