If you didn’t sell the house you’d be good now!
Essential Economics for Politicians
- Thread starter Bruddah IZ
- Start date
-
- Tags
- finance too
Why do you lick these brief little eras when things went “off the rails?” Why would you buy a house at a 17% mortgage? Try to make sense.
Bruddah IZ
DA
In the 70’s we werenʻt subsidizing debt like we are now. Not surprising that messy finds private lending a weird concept when in the 70’s, if you were a saver then you were easily a lender.
Bruddah IZ
DA
The bank doesnʻt care about that. They get paid regardless. Does your “asset” do that?
Bruddah IZ
DA
Especially if youʻre the lender. They get paid every month by the borrower who also buys default insurance (PMI) for the lender as a part of their monthly payment. Does your asset do that?
Bruddah IZ
DA
Not as good as the bank is.
Bruddah IZ
DA
Because of the inverse relationship between interest rates and home prices.
No. I think it’s because the buyer is a dummy.
You’re not the bank. Banks are institutions. Simple rule is you do great in real estate...but don’t live above your means.
Once again you don’t understand. The lender is an institution. The buyer isn’t. Your only choice is to be a buyer. Or not, so stay poor while you read your backwards-ass economics analyses. Try actually doing things.
Bruddah IZ
DA
People buy more homes when money is cheap, less homes when money is expensive. The housing industry responds to higher interest rates by lowering home prices. Questions?
I bought my first house in Poway in 1976 for $42,000. I sold it in 1993 for $160,000. When we first moved in, we hadx beeen paying $120/month rent for a 2-bedroom place, and our house payments were about $400 (including compulsory payments to an escrow account for insurance and property tax).
The bank can lose money if they foreclose on a property and sell it for less than the remaining principal on the loan.
PMI is not always required.
Bruddah IZ
DA
And you can deduct the interest on your taxes.
Bruddah IZ
DA
That’s why they get you to pay for their PMI so that they don’t lose money if that happens. Dude there is no way you’re a real estate guy.
We had an adjustable mortgage that got up to over 20% once. We were able to refinance after a couple of years to a loan below 10%, and an even lower rate than that when we refinanced in a deal that got some cash out of the equity. My experience from all that was that if you are holding an asset with positive equity and a good credit record then lenders will fight each other to give you money.
You better check with t on that.
Hilarious.
No questions. Advice. Pull your head out of your sophomoric readings and actually engage in commerce. Real estate and otherwise. You will learn much more that way.
