Posted on 11/12/2008 4:15:05 PM PST by Scythian
My wife is sitting here griping about how we have to pay for all these people defaulting on their homes and she couldn't understand why they couldn't refi or renegotiate and avoid defaulting when she said something BRILLIANT.
They should give them 50 year Mortgages, that way the payment would be way, way lower, no bailout money needed.
Honestly, I think this could be a real solution, create a new kind of Mortgage for these folks, give them the chance to pay and still own the home, what do we care if they get 50 year mortgages, we don't have to bail them out this way !!!
Not possible: far too simple, no need for gvnt help. Never work except in Europe where is common.
The difference in payment on 100K loan 50 years vs 30 years is only about $40 per month but an extra 110K interest over the 50 years.
Why not 100 year mortgages?
Go find a mortgage calculator and see the difference between a 30 year and 50 year mortgage and then get back to me.
Sure....50 year mortgages. These people are deadbeats and the lending institutions are criminals. Let them fail and let the chips fall where they may.
LOL. Yep..and what if they are 75 years old?
Your wife is brilliant...now, don’t forget that. ha.
he he, well, okay, maybe it wont work, but dang it, I’m we’re thinking out of the box here ...
Part of the problem is most people assumed prices would go up - that assumption was built into the higher prices. Like most pyramid schemes, it was destined to crash. Due to a liquidity bubble, prices were artificially raised on a good that was intrinsically less valuable (cost of construction, etc.) A 100-year mortgage would lock in this overpricing.
Depending on the interest rate, a 50 year mortgage would probably go into negative amortization after only being a day or two late. The higher the interest rate and longer the term of a loan, the quicker it goes into negative amortization. Not really a good option.
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There is too much thinking outside the box! We need to focus on the box!
I like box. :)
depends on whose money is in the box...
The same mortgage for 50 years = $1,691.15/mo-P&I, $1,014,690.40 total 600 payments, $714,690.40 total interest paid.
Sooooo in exchange for paying $205.05/mo less, you get to pay $332,056.93 more interest.
Anyone who took a subprime mortgage will surely go for this.
No more than 30 years and no one gets a loan without at least 20% down.
If they need the 50 years they ain’t gona pay that one either.
It would save far more money to buy a cheaper house and get a 10 year mortgage, then trade up after 5 years
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