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

[1srelluc]

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.

I have a feeling a 50 year note will be a whole other animal. The lending institution is gonna get theirs first.

 

[OODA_Loop]

A 50yr mortgage goes well with a 72 month car payment.

 

[elektra]

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.

yes, there are many many ways to look at it, like there are so few homes and they have given you so much equity that most people can not afford the homes.

Yes, equity, you know who else loves equity. Property taxes. I get taxed on the value of a home, every year. I get taxed on value I have never ever had in my pocket.

Yep, I want my house to go up so much in value, I can no longer live in it. Equity has resulted in greed, from home owners to banks to the government tax collectors.

On my house in connectictut I pay more in property taxes and house insurance than I do for the mortgage! With 50 year mortgages, that will effect my property taxes and I will pay more.

Congress will love a 50 year mortgage, all the state governments will love 50 year mortgages.

 

[RhodyPatriot]

Nobody says you have to stay 50 years.

Exactly.

There are no pre-payment penalties on mortgages (or the vast majority of loans in general these days.)

Nothing is stopping someone from paying it off within 15-30 years and forgoing the future interest.

That said, I do agree with the OP that it proves how bad Biden and his minions dragged down our economic might in those four dark years.

We're still diggin' out, but we'll get there.

 

[Concerned American]

I have a feeling a 50 year note will be a whole other animal. The lending institution is gonna get theirs first.

The lending institution ALWAYS get theirs first. That is why the interest is front loaded on loans. Nothing changes. If you pay more than your payment, every penny above the payment is applied to the principle. Loan companies don't like it when you do that.

 

[Marener]

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.

It barely lowers monthly payments and takes forever to get anywhere with the principle of the loan.

If property values decrease, suddenly a ton of people are underwater.

 

[leftwinger]

It barely lowers monthly payments and takes forever to get anywhere with the principle of the loan.

If property values decrease, suddenly a ton of people are underwater.

Same as with 30 yr. And the bank has 20% down cushion. $100K to $200K for a CA within 1 hours of a normal "good" job.

Again, at least you get in the market.

 

[Nostra]

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.

Reall estate generally goes up in value, especially long term. Even if these folks are basically treading water on their loan balance the first several years they are still better off than renting. That money is just pissed away.

 

[Concerned American]

Same as with 30 yr. And the bank has 20% down cushion. $100K to $200K for a CA within 1 hours of a normal "good" job.

Again, at least you get in the market.

And that 20% can be circumvented with the purchase of primary mortgage insurance at the outset.

 

[Independent thinker]

.... 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.

It's not as dumb as it sounds. In fact, far less than half of people who buy homes with a 30 year mortgage stay in them for 30 years. Most people sell and move up the ladder as they go, taking home appreciation with them. Mortgaging a home for 50 years is better than renting for 50 years.

 

[whitehall]

30 year mortgages aren't written in stone. What bothers the TDS left most about 50 year mortgages, the affordability or the fact that Trump suggested it?

 

[buttercup]

We're getting closer and closer to "You'll own nothing. And you'll be happy."

 

[CrazyTrader55]

30 year mortgages aren't written in stone. What bothers the TDS left most about 50 year mortgages, the affordability or the fact that Trump suggested it?

"The OP" is basically a Trump guy. He's done a lot of pretty good things, starting with closing Biden's open border.

 

[Thinker101]

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.

Well, if there's going to be an inevitable "CRASH", just sit it out and wait in your mom's basement.

 

[Thinker101]

We're getting closer and closer to "You'll own nothing. And you'll be happy."

View attachment 1184915

Only in NYC, so far.

 

[Zincwarrior]

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?

Pay interest only for 25 years.

 

[Concerned American]

Pay interest only for 25 years.

Or show them all and save for those 25 years and pay cash plus equity that built over that time. Your choice--but whatever you do, QUIT WHINING about what you have to pay.

 

[Jim H - VA USA]

.... 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.

1) It's better than renting.

2) Lots of people refinance, extending their mortgages beyond 30 years.

3) If you get a 50-yr mortgage on a $300k house, and your house doubles in value, your net worth increases by the $300k, even if you have not paid off any principal.

 

[Foxfyre]

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.

And building equity, however slowly due to whatever a person/family's financial situation is, is a good thing so long as the buyer is wise to buy in areas in which properties will appreciate. It must also be said and so long as the government doesn't go batsh*t crazy and allow/encourage/force lenders to make loans with bad credit, poor track record for honoring debt, or unproven ability to pay what they owe.

There is a good reason for common sense banking regulations to protect those of us with savings in those banks as well as all home owners' property values.

 

[Winco]

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

WRONG.

Nothing wrong with it.

WRONG.

Nothing stops you from paying it off early.

No Shit Sherlock.
Nothing stops you from paying it off early.