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re: Trump promoting a 50 year mortgage. Dave Ramsey will lose his mind. Terrible idea - imo
Posted on 11/11/25 at 8:23 am to AncientTiger
Posted on 11/11/25 at 8:23 am to AncientTiger
cannot imagine where this could be a reasonable option.
Sound like selling yourself into indentured servitude
Sound like selling yourself into indentured servitude
0
Posted on 11/11/25 at 8:24 am to Taxing Authority
quote:Relevance?
The 30yr aligns better to working lifespan.
IIRC < 1% of 30yr loans are held to maturity.
Posted on 11/11/25 at 8:26 am to NC_Tigah
quote:
Not true if a first time buyer avoids purchase because he's concerned 30yr notes will leave him house poor.
Being upsde down is house poor. You just don't "feel" it. Until you do. No different than having $30T in debt.Posted on 11/11/25 at 8:27 am to Taxing Authority
quote:‘The 30-year fixed-rate mortgage is a uniquely American construct,’ analyst says. Here’s why:
he 30yr aligns better to working lifespan.
Posted on 11/11/25 at 8:31 am to NC_Tigah
quote:Maybe you want a house payment well into retirement, but I don't.
Relevance?
quote:This isn't relevant. The number of transacted loans is high. They get rolled into another house loan (usually at an upgrade in principle).. And it kinda proves the point. Why saddle yourself with even more interest on the front-end if you can upgrade later?
IIRC < 1% of 30yr loans are held to maturity.
Posted on 11/11/25 at 8:33 am to SDVTiger
quote:
You ppl are incredibly dumb
Says the guy who is championing 50 year mortgages and has been whining, crying, wishcasting for mortgage rates and fed rates to come down for years on here. Wonder why?
Posted on 11/11/25 at 8:34 am to Taxing Authority
quote:Well ... that would be true of anyone with a house note, right?
Being upsde down is house poor.
Posted on 11/11/25 at 8:35 am to NC_Tigah
quote:Indeed! The only reason we can do it is because:
‘The 30-year fixed-rate mortgage is a uniquely American construct,’ analyst says. Here’s why:
- we're teh worlds reserve currency,
- our government can borrow enough money to bail out the banks who have to take on inordinate risk over 30-year period.
I never argued a 30 year is a good idea. And none of that implies a 50 year is a better idea.
Posted on 11/11/25 at 8:36 am to NC_Tigah
quote:
Assuming for simplicity not one penny to principal over the first 20% of a 50yr term, assuming the monthly notes approximate what would otherwise be paid for rent, assuming 10% down on a $400K home sold 10yrs later for $750K, ROI on the DP would be 875%.
You're using basically the best case scenario (rents being equal to mortgage payments, appreciation) and ignoring maintenance costs, and then comparing the appreciation in this perfect scenario to only the down payment, when he was talking about net worth.
At a 3% appreciation rate, that 400k becomes 537k over 10 years
At a 5% appreciation rate, the 400k becomes 651.6k over 10 years
The historical norm is 3-5%.
There is a 38% difference in mortgage-rent costs nationally. That doesn't even include insurance/taxes/HOA/maintenance.
Per Gemini, that 50-year loan's monthly mortgage would be $2,168, which would mean the comparative rent would be 1,344.16. That would be an annual difference of 9,526.08 and monthly difference of 823.84.
Taking that $40k + a monthly contribution of 823.84 would net you $268,405 at 10% annual interest and 219,605.31 at 7% interest.
Again, and that's WITHOUT including insurance, taxes, maintenance, etc.
Also, that's assuming that the house appreciates at historical norms.
This post was edited on 11/11/25 at 8:37 am
Posted on 11/11/25 at 8:38 am to NC_Tigah
quote:
Well ... that would be true of anyone with a house note, right?
Pretty much. Or with a high property tax I mean if we're going to presume that values always go up, and they're always going to go up faster than inflation... seemingly one would want to own all of the asset. Not less.
I just don't understand how we ever improve "affordability" in an ever increasing market that beats inflation, and the fed rate.
Posted on 11/11/25 at 8:42 am to SlowFlowPro
quote:The 50yr mortgage is a palatable version of "you will own nothing, and be happy".
Also, that's assuming that the house appreciates at historical norms.
Posted on 11/11/25 at 8:43 am to Taxing Authority
quote:
The 50yr mortgage is a palatable version of "you will own nothing, and be happy".
What changed in a year and change?
Posted on 11/11/25 at 8:51 am to Taxing Authority
quote:
Ma dude. I can find you a couple of years 2007-2009 and show you the chaos it called for people that became underwater on their homes, to the point that the Fed had to buy massive amounts of bad debt to keep banks from collapsing.
A couple of years is the best you can do. The average homeowner stays in the home for 10 years.
quote:
Not if you're paying $800k in interest. Do you people even know what an amortization table is?
You are not paying $800K in interest over 10 years
quote:
And it makes the point for me. In order for people to not have to bring a check to sell their own house at closing you need the price to increase rapidly and steadily. Again we saw this 2009-2010, lots of people were so upside down on their loans they simply kept the prices high, because they couldn't afford to sell their "own" house. Either way, they were getting foreclosed on.
After 10 years you have paid down the debt by 5%. Also you aren' getting foreclosed on if you are paying the mortgage and you aren't getting a mortgage today if you can't afford the payment. In 2008, you just called the mortgage company, asked for money and they gave it to you. Thats not happening today
Posted on 11/11/25 at 8:52 am to Upperdecker
quote:
Can you imagine paying for something for 20 years and having no equity?
Big city living... Many rent for their whole lives.
Posted on 11/11/25 at 8:54 am to SlowFlowPro
quote:
At a 3% appreciation rate, that 400k becomes 537k over 10 years
At a 5% appreciation rate, the 400k becomes 651.6k over 10 years
The historical norm is 3-5%.
Its about time you stopped with your denial of this Diana
Posted on 11/11/25 at 8:55 am to SDVTiger
quote:
Its about time you stopped with your denial of this Diana
Your straw man being repeated is noted.
You can go re-read what I actually said if you want to contribute and stop just making shite up.
Posted on 11/11/25 at 8:55 am to Man4others
quote:
A couple of years is the best you can do
Yeah let's just dismiss that it almost completely broke our financial institutions
And let's ratchet up stupidity that makes that more likely
Posted on 11/11/25 at 8:57 am to Man4others
quote:
Also you aren' getting foreclosed on if you are paying the mortgage
Thankfully people never lose their jobs and all Americans have a robust emergency fund right?
Posted on 11/11/25 at 8:59 am to Man4others
quote:
A couple of years is the best you can do.
Had a look at our fed debt lately? The only reason is was "a few years" is because the Treasury/Fed bailed out the banks and re-inflated the bubble. quote:You probably aren't paying off the loan in 10 years either
The average homeowner stays in the home for 10 years. You are not paying $800K in interest over 10 years
And even if you move, the odds you you downgrading are slim to none. quote:
you aren't getting a mortgage today if you can't afford the payment
Literally what this thread is about. Extending the terms to 50ys because people cannot afford a 30y.Posted on 11/11/25 at 9:00 am to Taxing Authority
quote:
Maybe you want a house payment well into retirement, but I don't.
This is not about me (I posted personal particulars re: loan leverage use earlier in the thread), or you.
For owner's of a 50, if they apply the monthly difference between their 50yr note and a 30yr at the identical interest rate, they pay the 50 off in 30, with identical interest in total 30 vs 50. Obviously with increasing term 15 vs 30 vs 50 there will be an associated premium, but the point stands.
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