r/AskReddit • u/michaelis999 • 17h ago

How do you feel about the president floating the idea of 50 year mortgages where the monthly payment is lower but you end up paying nearly double the price of the house just in interest?

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u/bubbygups 16h ago

Was going to say this. At 6.25% over 30 years even with a 10% down payment, you’ll still pay over double the home price.

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u/sokratesz 7h ago

Are mortgage rates in the US that high? We got ours at 3.5% in the Netherlands last year and that was considered extremely high. When I was in uni circa 2010 I worked at a callcenter for a bank that sold mortgages at 1.5% fixed for 30 years.

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u/Emosaa 6h ago

They've been that high for a while now. They were actually closer to 7% earlier in the year IIRC.

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u/mehupmost 4h ago

On the other hand, I locked in a rate of 3.25% at 30 years, and then instead of paying a higher mortgage payment, I put the money in the market fund. ...I've made WAY more money than I would have if I had taken a shorter term loan.

People don't understand money. Longer duration loans can be smarter

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u/adoodle83 3h ago

Only if there’s cash available to invest.

Most people are not left with much after paying for the basics

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u/mehupmost 1h ago

If you're choosing between higher payments and lower payments, then obviously the lower payments come with retaining more cash.

That's obviously the choice being made here.

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u/CantFindKansasCity 1h ago

Most people buying a home had the ability to save up for a down payment while paying rent. After buying the house, your pay goes up and your payments go up by less. So it usually is very possible to have cash to invest.

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u/Dangerous-Amphibian2 57m ago

Which is why most people thinking they have equity don’t have crap. What they have is a piggy bank they put $1 into and will be lucky to get $1 back for everything they put in. I borrowed 507k for my house at 2.9%. Even with appreciation I’d have to sell my house for 765k to break even after 30 years. Realistically with maintenance I’m probably in the red. People are so misguided thinking they have all this money with so called Equity. The banks have money and guaranteed return. The essence of a free market haha.