disturbing.. the 50 year loan

[hipmatt]

another reason why the mortgage brokers are responsible for this disaster…

check it out at bankrate.com The 50 year loan rolls out in CA.

http://www.bankrate.com/brm/news/mortgages/20060427a1.asp

[speaker]

SoCalMtgguy from “another F’d borrower” was predicting the introduction of 40 yr. loans last year. Therefore, to see a 50 yr. loan is not surprising.

This totally makes sense because there are a great number of people who are still fixated on monthly payment rather than actual debt. Car dealerships have been offering 5 to 6 yr (even 7 yr in some cases)finance options on the purchase of new cars. Who wants to take 6 years to pay off a Honda Civic!?

For 30 somethings like myself, I don’t want to be 70 or 80 yrs old by the time I pay off my house. Good lord….

“End of line.”

[john67elco]

Agree 100%. I remember 10 years ago when I started my job at the age of 20. I saw this 5.0 convertible mustang. While negotiating price, I didn’t care due to me having the “I’LL DO ANYTHING AND PAY AYTHING TO GET INTO THIS” attitude. People barley in a position to buy a house still have the same mentality and they say “I’ll pay more on principle and pay it off in 30 or less”. SURE you will>>>

[Bugs]

What’s the difference between getting into a 50-year mortgage that you don’t intend to be in long enough to pay off and being in an I/O or ARM? I would say that most buyers right now have no intention of staying in one home until it’s paid off.

It depends on how a person percieves the trends, too. If they think that during their holding period – whether that period is 1-year or 15-years – the overall value will go up then the trade off is between having cash to use now vs. having a little more cash in the future after they sell. It’s a shortsighted and imprudent way to look at things but you can’t be big pimpin’ without spending every available dollar that comes within your grasp.

[lendingbubblecontinues]

Beyond all that, it looks to me like this is a 5/1 adjustable rate product anyway.

All this to “save” a couple hundred bucks a month. C’mon…we all know most people will buy right up to what they are “qualified” for. I don’t think this product is any better or worse than what is out there already. It is simply designed to delay the inevitable and smoke us out of our holes (us=bubble-heads or jealous bitter renters or whatever we are called, that is) to BUY NOW.

We may be in for a long wait…hope not, but possible I suppose.

[powayseller]

My next loan will be a 15-yr mortgage, and that’s the product I had in Phoenix, before we were priced out of that product in San Diego. At some point, a house should be paid off. At retirement at the latest. How can a 50yr old get a 30 yr mortgage? Do they want to work to age 80 to pay it? Or do they think they’ll sell it and downsize? If the latter, they are counting on appreciation to make equity. You build equity by making payments. Oh, I forgot – paying and saving is the “old way” of finance. The modern way is to charge everything, even the house.

[Gone to Colorado]

How about paying cash for a house, rather than getting a mortgage? At the rate things are going, this will become a possibility in the U.S, maybe even in San Diego.

[lostkitty]

I started another forum topic about this realtor or broker (didnt look into it much) offering some sort of “no payment for 12 months thing”. No one posted any responses, but is this another even more frightening way of keeping people in the market as is crashes downward?

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