50 year mortgage

[Brad St]

When you take out loans nowadays be careful of the wording. They don't have penalties for early payoff but you are paying the same amount as the full term of the loan. in other words they don't lose money either way.

[Rstewart]

I have a really low interest rate on my current home.  I don't see any Real benefit of paying it off early, I probably like another 17 or 18 years before payoff.

[Newbeeee™]

The only problem i see, regarding delaying payment, is for instance, what happened to RonB.
Where the bastards doubled his payments overnight so he had to hand back the keys - aka when things are out of your own control.
You've paid them top money for 5,10,15 even 24 out of 25 years, then they repossess. All that lost money.

[jstell]

I have a really low interest rate on my current home.  I don't see any Real benefit of paying it off early, I probably like another 17 or 18 years before payoff.

There is that.  If you locked in a handful of years ago at under 4% or close to 3% and don't plan on retiring before the loan is set to be paid off, you are definitely going to build wealth faster by having any extra cashflow in an investment account making more than the interest on the loan.  House value is going up regardless of how much you still owe.

[jstell]

the bastards doubled his payments overnight

How does this happen on a fixed-rate loan?

[Smit]

How does this happen on a fixed-rate loan?

It doesn't. Some people chose a variable rate mortgage rather than a fixed rate because it was initially a lower interest rate. Then when the interest rates went up they found themselves paying much higher payments.

[gcode]

what happened to RonB.

that is why you never never never take out a variable rate loan.
I know a half dozen people who have lost their houses over the years and every one of them lost their home over a variable rate loan.

One of them had their house nearly paid for and took out a variable rate 2nd to pay for his daughter's wedding.
Then he put a cruise on it, then a boat, then a lawyer for his daughter's divorce ... then interest rates spiked into the low 20's

The payments on his 25 year old first were $300/month. The payment on that variable 2nd was over $2K/month
and he lost his house and most of his equity.

[gcode]

Back in the real estate boom in 2000 to 2005, agents and loan officers were pushing people into more house than they could afford touting super low variable rate payments. Back then an unemployed crack head could qualify for a
zero down $500K house. When interest rates started going up in 2007/2008 the blood bath began,
I paid $400k for my house in 2005. By 2010 houses in my neighborhood were selling for $225K.
I had a low interest loan, just kept making the payments and rode it out.

[TylerBeer]

Not doing stupid things like a 50 year loan is what has kept American housing market above water since the crash.

We already know we don't learn lessons from history, do we really want to prove it?

[gcode]

The payment on that variable 2nd was over $2K/month
and he lost his house and most of his equity.

and the real kicker was he had $150K in equity.
the sharks who wrote him the variable rate 2nd loan got the money and he got stuck with the capital gains tax.
He was making monthly payments to the IRS for 15 years.

[Newbeeee™]

How does this happen on a fixed-rate loan?

Memory now and whether Ron chimes in or someone with better memory than me adds/corrects, but it was around/just after the 2008 crash.
Ron was still busy, paying without missing a payment, and 2 or 3 suits knocked his door stating how they had bought the bank he was with, and "as he was self employed he was now high risk'.
He argued he had never missed a payment, yet they doubled it.
The bastards.

[Newbeeee™]

Not doing stupid things like a 50 year loan is what has kept American housing market above water since the crash.

We already know we don't learn lessons from history, do we really want to prove it?

"Fannie Mae and Freddie Mac together back or hold about half of all outstanding U.S. mortgages, totaling over $5 trillion as of recent estimates, making homeownership accessible to millions who might otherwise face higher costs or limited options".

Errrr, apparently not....

[neurosis]

that is why you never never never take out a variable rate loan.

I have a good friend who is a mortgage loan processor. She tried to convince me to get a variable rate loan on my first Condo. Her reasoning, was that it was my first house and the number of people who stay in their first house long enough to pay off the mortgage is very small. Most first time home buyers only stay in that first home for about 5 years and realize that they want something different.

If that's the case, you end up saving money while you're looking for the home you really want.

Ofcoures I was a chicken shit and didn't listen. I paid the higher initial interest rate (no varaible rate loan) and sold the condo two years after moving in. Just like she said I would.

I've lived in my current place for 11 years and will probably be here until I either retire, or find a job somewhere else.

[MIL-TFP-41]

Hey, Donald is for it so it must be a good idea!

The very few people I have seen defending this "plan" are 100% convinced Don's shit doesn't stink...he can do no wrong...they are already spending their $2000 tariff checks.

[neurosis]

.they are already spending their $2000 tariff checks.

All they had to do to know that was bullshit, was pay attention to how he worded what he was saying.