An idea so dumb..... (50 year mortgage)....

[CrazyTrader55]

.... that I would have expected it came from a big government leftist.

Trump proposed a 50-year mortgage. What it would mean for homebuyers

President Donald Trump recently proposed the idea of creating a new 50-year mortgage as a way to improve housing affordability.

www.usatoday.com

Dumbest, stupidest idea I've ever heard of. Let's enrich the banks even more and trap people in debt, for life, just to save a few hundred bucks a month in interest.

This shows how sick our economy really is, that it would even be proposed. People ought to be figuring out how to take a 15 year mortgage and pay it off, instead of figuring out how to lower the monthly payment, which most people would simply spend anyway.

 

[Nostra]

Seems like a marketplace decision to me. If some people need it to get into homes I have no problem with it.

Who decided 30 years was the number?

 

[Silent Warrior]

Japan has available 100 year mortgages. I think they expect the family to continue to pay after the death of the purchaser.

 

[leftwinger]

Nothing wrong with it. In a place like CA, it may help young couples get into that first home.

Nobody says you have to stay 50 years. Conditions in lives change over time. They already had 50 yr loans out there.

TDS again.

 

[leftwinger]

Will it off to your kids to inherit the mortgage too. Payment would be low.

 

[CrazyTrader55]

Nothing wrong with it. In a place like CA, it may help young couples get into that first home.

Nobody says you have to stay 50 years. Conditions in lives change over time. They already had 50 yr loans out there.

TDS again.

No, it's not TDS. I voted twice for Trump and totally support him closing the border.

Try again.

All a 50 year mortgage does is postpone the inevitable CRASH of real estate. It's bad news.

 

[Silent Warrior]

Interest only mortgages were once a thing. The idea was that if you kept the interest up you could sell at a profit when RE values rose. Trouble was a downturn in the RE market showed what a stupid idea it was.

 

[Rogue AI]

No, it's not TDS. I voted twice for Trump and totally support him closing the border.

Try again.

All a 50 year mortgage does is postpone the inevitable CRASH of real estate. It's bad news.

Nobody is forced to participate. It is a personal decision that could be workable for some but idiotic for others. There really should be nothing wrong with more options.

 

[CrazyTrader55]

Nobody is forced to participate. It is a personal decision that could be workable for some but idiotic for others. There really should be nothing wrong with more options.

If it's a choice between bad options or no options, I'll take no options. Of course nobody is forced to participate. How about teaching some personal finance in schools? How about learnin' them what interest is, how debt kills. Rather than teaching them black history, slavery reparations, DEI, "liberal arts" and so forth. Housing prices are just about at the breaking point. A crash is coming - the only question is when.

 

[Concerned American]

People ought to be figuring out how to take a 15 year mortgage and pay it off, instead of figuring out how to lower the monthly payment, which most people would simply spend anyway.

What is keeping you from paying the same payment on a 50 year mortgage that you would pay on a 15 year mortgage? The difference is you may qualify for a 50 year but not a 15 year. Nothing stops you from paying it off early.

 

[1srelluc]

You might know that it was the .gov that came up with 30-year loan.




The 30-year mortgage was primarily introduced during the Great Depression as a response to the financial instability of short-term loans. It was popularized by government war bonds and the Liberty Bond campaigns, which introduced the idea of long-term savings and borrowing. The Federal Housing Administration (FHA) played a crucial role in shaping this model by offering FHA-insured loans with lower down payment requirements, making homeownership more accessible. This combination of government support and the introduction of long-term financing helped establish the 30-year mortgage as a standard in the U.S. housing market.

 

[Foxfyre]

.... that I would have expected it came from a big government leftist.

Trump proposed a 50-year mortgage. What it would mean for homebuyers

President Donald Trump recently proposed the idea of creating a new 50-year mortgage as a way to improve housing affordability.

www.usatoday.com

Dumbest, stupidest idea I've ever heard of. Let's enrich the banks even more and trap people in debt, for life, just to save a few hundred bucks a month in interest.

This shows how sick our economy really is, that it would even be proposed. People ought to be figuring out how to take a 15 year mortgage and pay it off, instead of figuring out how to lower the monthly payment, which most people would simply spend anyway.

Millions of Americans have or have had 50 year mortgages due to refinancing of their 30 years loans as economic conditions were favorable for that.

Nobody is encouraged or requited to take out a 50 year mortgage, but just as the 5-year car loans are now available that allows people with good credit to buy cars they wouldn't otherwise have been able to afford, the option could allow people to become home owners and begin building equity that increases their net worth. Anybody can choose to continue to rent for many reasons, both good and not so wise, but home ownership has proved its merit to stabilize, improve, and be a good thing for families, neighborhoods, communities.

And as people's personal economic situation changes, there is nothing to keep them from refinancing those 50 yr loads into 10-15-20-30 year loans so they pay off those loans more quickly.

 

[elektra]

Seems like a marketplace decision to me. If some people need it to get into homes I have no problem with it.

Who decided 30 years was the number?

Who? The banks decided 30 years was a good profitable number. Before that the government only guaranteed 15 year loans. Funny how the price of houses doubled after that.

The government should guarantee 7 year loans, no more. Then we will see the price of housing drop.

 

[elektra]

Anybody can choose to continue to rent for many reasons, both good and not so wise, but home ownership has proved its merit to stabilize, improve, and be a good thing for families, neighborhoods, communities.

and how much better would those communities be if we could pay for our homes, in 7 years

 

[1srelluc]

And as people's personal economic situation changes, there is nothing to keep them from refinancing those 50 yr loads into 10-15-20-30 year loans so they pay off those loans more quickly.

Barring refinancing, it depends what the penalties are for an early lump sum payoff.

 

[Foxfyre]

and how much better would those communities be if we could pay for our homes, in 7 years

Some are able to do so. My husband and I have never been in that position and have always taken out 30-year-loans. Yes you pay a ton in interest and fees doing that, but we nevertheless have increased our net worth as the properties we have bought have appreciated in value more than the cost to us for those loans.

There are many different ways to look at this.

 

[elektra]

50 year loans. It seems after all this time with Trump people would realize that Trump starts from an extreme position to begin his bargaining.

Hopefully Trump plans on making homes affordable by getting the government out of the housing business. Trump is getting a housing discussion going.

30 years is way too long to guarantee loans. 7 year car loans are too long. Time to reset the market and quit with loans that last lifetimes.

 

[Rogue AI]

If it's a choice between bad options or no options, I'll take no options. Of course nobody is forced to participate. How about teaching some personal finance in schools? How about learnin' them what interest is, how debt kills. Rather than teaching them black history, slavery reparations, DEI, "liberal arts" and so forth. Housing prices are just about at the breaking point. A crash is coming - the only question is when.

Wow. You realize that some real estate markets are completely out of reach due to circumstances that have nothing to do with first time buyers? Your chicken little howling doesn't change that. This isn't about what liberal arts are taught, it is about getting people into homes. Having options isn't a bad thing. You need to accept the world isn't going to magically change into what you want and deal with what it actually is.

 

[Concerned American]

Depends what the penalties are for an early payoff.

I know early payoff penalties exist, but in my experience over 50 years and quite a few mortgages and refis, and early payoffs---I've never been exposed to one.

 

[Foxfyre]

Depends what the penalties are for an early payoff.

There don't have to be any penalties for an early payoff. My husband and I still have a relatively small mortgage due to a refi when interest rates were at their lowest some years back, but could pay that off now without any penalty. We have had to pay off the mortgage on every home we've owned over the years as we sold and rebought as we moved from place to place or upgraded, and have never had to pay a penalty for an early payoff.

You have to be smart when you finance these things.