A mortgage product is emerging that could be beneficial for people who want to own their homes more quickly and save on interest.

Let me say up front -- this is not for the faint of heart, and financial discipline is a must.

A home ownership accelerator loan operates like a home equity line of credit. It's designed for people with good credit, who are good savers and have high monthly cash flow. In other words, if you are living from paycheck to paycheck, this product would not work for you.

Here's how it works:

Borrowers deposit their entire paychecks in the mortgage account created when the accelerator loan is taken out, which lowers the monthly balance. The monthly interest is calculated on the lower principal balance. As a result, the borrower pays less interest. So if your loan is for $100,000 and you deposit $5,000 at the beginning of the month, you will be charged interest on $95,000. At the end of the month, the borrower writes checks on the mortgage account to pay other monthly bills. Any savings left can remain in the account and is used to lower the balance and build equity.

If the borrower continues this cycle and is disciplined enough to not touch the equity, the home could be paid off in almost half the time of a traditional 30-year fixed mortgage.

Though it's not a subprime loan product, a home ownership accelerator loan has the potential to further damage the mortgage industry. If lenders are careless, they might sell it to consumers who are not sophisticated enough to manage complicated loans.

"As we learned in the subprime market, loans with different payments that change a lot is what trip people up," said Mark Pearce, North Carolina's deputy commissioner of banks.

"I've seen a particular set of folks this could work for," he said. "But for a lot of folks who may not be the best at managing money or have low income, I would be reluctant to let them give up the fixed monthly [mortgage] payment."

Pearce said he is not aware of any complaints his office has received about the product. But it's relatively new to this area.

The loan traces its roots to Australia, where mortgage interest isn't tax deductible, so homeowners want to pay off loans as fast as possible. A couple of years ago, companies such as Macquarie Mortgages and CMG Finances began offering the product in the U.S.

Using the product, someone with a home worth $300,000, who has a $240,000 balance and earns $7,000 a month could pay off the mortgage in about 11 years at an APR of 7.13 percent, according to the CMG home accelerator calculator at www.homeownershipaccelerator.net. With this, the homeowner would avoid about $180,000 in interest.

As with all financial matters, there are pros and cons. First, some cons:

* One potential downside is that these loans are adjustable-rate products, which means monthly payments are tied to short-term interest rates and can fluctuate from month to month.

* Another is that borrowers have immediate access to their equity -- without having to refinance -- by simply writing a check. This might be too tempting for some people, especially those who tend to run up credit card balances.

* If you use your entire paycheck to push down your mortgage principal, you have no resources to invest in something that could yield a higher return.

* Finally, for this product to work for you, you truly have to be a savvy consumer. That means understanding how interest rates work or having a financial adviser whom you trust to walk you through before you sign on the dotted line.

Now some advantages:

* When you make extra payments toward your principal, your monthly payment will likely decrease. This might be a good option for people who want to have a lower monthly payment when they retire.

* You have immediate access to your equity. I know I listed this as a con, but it can be a good tool for savvy investors who need access to cash to begin a project or make an investment. The key is having the discipline to pay it back.

* You don't have to change your spending habits or make huge financial sacrifices to pay off your mortgage early. With other accelerator programs, you have to find extra money in your budget to make additional payments to your mortgage.

This accelerator mortgage loan proves that there is no shortage of innovative mortgage products available to savvy consumers. The key is finding one that meets your goals.