OT: 50 year mortgages?

[JimmyinSD]

I disagree with the idea that it isn’t the banks job to ensure the customer is making a smart decision.  Housing is a necessity.  If there aren’t enough houses, people will just borrow whatever the banks will lend them, which is way too much money, and it drives the price up for everyone.  There is nothing in the system that punishes banks from overlending.  Banks will give children credit cards that trap them in debt.  If you can’t afford your house, the bank just takes it back and resells it to a new sucker that prefers to live inside a building.  If they do it too much, they just have the politicians they bribe to make the taxpayer pay for it.  They are actively incentivized to push debt onto people as fast and as large as possible.  If we ever want to get out of this cycle of everyone being in debt up to their eyeballs, there needs to be some mechanism that restricts banks from overlending.

The problem that happens when you make it harder to get a loan, is that you are making it so that only investors can buy houses and that will push it further towards gen Z+ never being able to afford a home.  There needs to be some mechanism that prevents investors from buying property that should be going to home owners.  I think the local governments all need to gathering data on how many homes of each type (single family, condo, apartment, rental homes, airBNB, etc.) are needed to support the community, and if the quantity is below the threshold, they need to inhibit investors from buying those homes.  I don’t know the best way of doing that, maybe you just tax them at a higher and higher rate until they drop out of the market and put that money into a fund to be used as the down payment for a first time homeowner, or invest in new housing development or something.

There is no reason homes that aren't owner occupied aren't taxed at a significantly higher level.  Make an exception for a 2nd home st the lake or whatever,  but I agree,  there needs to be a financial deterrent to people buying up housing.  

However,  if people aren't smart enough to protect themselves,  there is very little we can do to help them without creating other issues.  It's a free country and if somebody allows themselves to get duped then I guess its unfortunate.   I would make the exception for minors mentally disabled, and elderly.

I just dont see how in a free market free country you can place enough safeguards without either being called discriminatory or other.  Seems to me there used to be more protections in place,  but those were deemed racist or other because low income people couldn't qualify and often those low income people were of other minority statuses.

Edit: and homes used as air bnb/ vacation rentals/ etc....definitely at much higher levels, really shouldn't be allowed as they are then more of a commercial property and are zoning law violations in most cases.

[hogjowlsjohnny]

Any instrument that makes more money results in more revenue for the government. The government doesn't protect it's citizens from economic predation; it encourages it! It's about money, not people.

[BigAl99]

Any instrument that makes more money results in more revenue for the government. The government doesn't protect it's citizens from economic predation; it encourages it! It's about money, not people.

I don't get the connection to government revenue, any profit from increased interest goes to the bank investors and hedge fund folks like be Scott Bessent, our Treasury Secretary. The additional years front load the interest portion by more than payment and also reduce any paying on the principal.  He was former partner at the Soros fund management and founded Key Square Group, a global macro investment firm.  He's the originator of this lifetime mortgage concept.  If it meant more revenue for the government it would at least be slowing down the rate of debt, which at least would have some benefit to the US.