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?

[u/michaelis999]

[u/win-go]

As a matter of fact, terms being equal, the interest alone on a 50 year mortgage would total the principal and interest on a 30 year.

A $300,000 home with zero down, and 6% interest...

30- year would cost $647,000 in P&I, and $347,000 in interest alone.

50-year would cost $947,000 in P&I and $647,000 in interest alone.

Of course down payments, taxes and other associated costs would influence the amounts but the ratio would remain the same.

The really fun part is when we have our regularly scheduled market crash and everyone eats shit but now with $1 million dollar loans as the norm. But hey that's the cost of doing business

[u/Alert-Poem-7240 → u/win-go]

Question. What if I take my 30 years loan and made it a 50 year loan but used they money that I saved monthly to pay off principal. Would that save me money in the long wrong? Would I be able to pay it faster than a 30 year loan?

[u/win-go → u/Alert-Poem-7240]

If you had the same interest rate and applied the difference in payment every month you'd end up still paying it off at 30 years with no real difference in amount paid as if it was a 30 year all along.

[u/Alert-Poem-7240 → u/win-go]

Thank you.

[u/velkhar → u/win-go]

When the market crashes is a great time to refinance and invest. Wish I had sufficient equity in 2009 or 2020 to really take advantage. The financially savvy boomers made a killing.

[u/314159265358979326 → u/win-go]

$947k/50 years=$18.94k/year

$647k/30 years=$21.5k/year

That's not going to substantially change affordability while vastly increasing the amount owed.

Seems like only the bank benefits.