Why do people take out Mortgages they can't afford?

[Drakain]

Because unscrupulous lenders approve them. Watch the big short, it's on netflix.

[Independent voter]

Is said home an apple barrel with leg holes cut in the bottom?

Something like this, probably not the best neighborhood.

[monkmastaeq]

If you think about it logically, you should only be taking out a loan if you can make the payments. If you are cutting it so close that if rates rise, you can't make payments, then don't take out a mortgage.

Whatever happened to restraint and living within your means?

If you can't afford to purchase a home then rent or move elsewhere.

This is not how mortgage loans work, you must not be a home owner

[Deleted]

Because it's what society tells you to. The same reason u get kids in your late twenty early 30s. And then your stuck. Because losing your job means losing your house.

There is no better slave than someone who thinks he's free. Modern slavery focuses on slaves keeping themself housed and fed. While providing enough distraction ( bread and games ) for no1 to ask important questions.

[Deleted]

This is not how mortgage loans work, you must not be a home owner

Quite honestly; you don't need to know how mortages work in order to be a home owner.

But i think; if people had any kind of empathy they would understand and not ask questions like this thread.

[Flarelaine]

Something like this, probably not the best neighborhood.

Looks decent to me, obviously depending on neighbourhood.

[Fiftyonred]

Because we have no choice, immigration is inflating our housing prices beyond belief. Immigrants come here with little to no money and their communities pay for one another's properties, or they put 3 generations of family under one roof and pay the same property taxes as a family of four. It should be illegal, and the system is getting abused because our governments allow it.

Is the American really blaming immigration?

Do you even history, bro?

[FiveDkp]

Predatory Lending

https://www.debt.org/credit/predatory-lending/


Compound interest is a deceitful thing. Even when a lender tells you the percent of interest you are signing up for, the actual interest (effective interest rate) is almost always a higher amount. For loans that are hundreds of thousands of dollars over decades, one percent makes a huge difference.

Some people are stupid, some are lacking understanding, and some out just deceived. When people borrow large amounts of money, they are in a position of need, and depending on how needy they are, some lenders interpret that as desperation and prey on such borrowers.

The concept you speak of does not only apply to mortgages, it also often applies to car loans, credit cards and school loans.

The American Dream is to have a nice house. But how do you get money to pay off a nice house? Well you need a job. Well how do you get to work? Well you need a car. Well how do you land a job? Well you need an education. Well how do I get into a good school? Well you need a loan. Do you believe all these things are coincidental? We live in a material world of wants and needs. We are constantly being bombarded with ads telling us to get things we don't want, and to consume excess amount of things we do need.

People who are massively in debt are just the new age indentured servants.

Predatory Lending is a massive issue in credit card and pay day lending. It is a smaller issue in the Mortgage Market.

[Rudkobing]

If you could afford it, then you wouldn't need to take out a mortgage.

[Mormolyce]

Something like this, probably not the best neighborhood.

Meanwhile I'm an experienced professional and can't afford to get into the house market in Melbourne.

[dakalro]

It should be illegal for 3 generations to live under one roof? Why?

I also don't see immigrants flooding our housing market. Most poor immigrants I know of rent or live in government assisted housing. They're not out here buying houses. And it's not like our "rich" neighborhoods are flooded with well off immigrants. The majority in my area are white upper middle class with a few asian-ethnicity outliers.

But it's immigrants, it's always their fault.

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No, they should pay considerably higher property taxes than smaller families. At least around where I live, there are many suburban neighborhoods dominated by immigrants now, and most of them do exactly what I said and pay the same property taxes as smaller families for the same sized homes. That in itself is unfair.

Well, it's a tax on property, not on people. The property size/value changes upwards based on how many people live there?

[oxymoronic]

Because before (and now after) it was made illegal to do so, banks would (and now once again are) pressuring people into signing, often by misleading them or in some cases outright lying.

I recommend the book (or movie) The Big Short to explain in detail. And keep in mind that all those things the banks did, were made illegal by Obama and now legal again by Trump.

lol... not sure how to respond to this other than fucking laugh out loud. but yeah all the banks fault right.

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It is impossible to tell the future sometimes. You could be in the green one year when you buy but a few years down the line you could end up in the crapper.

tell me about it. i've been up and down more than a few times in my life. important thing is keep going, dont stay down.

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Reminds me of many years ago when my mum tried to pay off her credit card in full. It was difficult to say the least. Bastards wanted her to keep paying every so often for the interest.

uhh its illegal for them not to accept payment. so your story is bullshit and your mom is a liar.

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Why do banks issue loans/credit that can't be repaid is the larger issue.

they dont, all debt can be repaid. question is, is it?

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First, if you get a fixed rate loan, the rates can't rise. Second, it's most often because they are being told they CAN afford it. When a bank says, "you can afford X amount per month," it's very easy to simply think, "oh, okay." The problem is that some people don't have a great grasp of their actual finances. They also lack the foresight to budget in emergencies, like cars breaking down, large hospital bills, etc. So while in the end, it's because people just don't do the math, it certainly doesn't help when a bank says, "you can afford X." It's made even worse when banks create horrible loan systems that they sell you on and mislead you about. Unless you really understand what you're being sold, it's easy to just believe the "experts."

so you want a bank to do their finances for them? banks look at debt to earning ratio and if the numbers align bam you get a fucking loan.

[Blackmist]

Because society tells us to. If you have $1000 a month left over, don't save it. Buy a house. It's an investment.

What they don't tell you is that it's not an investment for you. It's an investment for the property developers selling them.

[oxymoronic]

Next time please don't make rude, unfounded accusations. Thanks.

you dont english very well do you. get your troll game up bro, you slacking

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Because it's what society tells you to. The same reason u get kids in your late twenty early 30s. And then your stuck. Because losing your job means losing your house.

There is no better slave than someone who thinks he's free. Modern slavery focuses on slaves keeping themself housed and fed. While providing enough distraction ( bread and games ) for no1 to ask important questions.

yeah cause you totally owed housing and food for being born. you dont have to provide for yourself, we got it bro. is what you want to hear, but reality be like, yo fucker get out and do something or die in the streets hungry.

inracted - minor spam

[Deleted]

Because people have no real clue about their finances.

Another problem is people in general only think short term, never long term.

[Deleted]

Because society tells us to. If you have $1000 a month left over, don't save it. Buy a house. It's an investment.

What they don't tell you is that it's not an investment for you. It's an investment for the property developers selling them.

All good. It's a lesson of life that "by nature" you won't get anything in the long run you don't deserve. Squirrels have to collect nuts for the winter and they can only eat what they collected/earned. Humans can cheat around this and make debts. Those debts can fuck you up (self experience) when you cannot generate enough income to pay them back. Lesson learned: do not spend what you don't have or reliably will have (hint: reliablity kek) . God does not allow or he gives you shit.

[Deleted]

If you think about it logically, you should only be taking out a loan if you can make the payments. If you are cutting it so close that if rates rise, you can't make payments, then don't take out a mortgage.

Whatever happened to restraint and living within your means?

If you can't afford to purchase a home then rent or move elsewhere.

Dumb people being dumb... there is no intrigue to this.

[Rennadrel]

But it's immigrants, it's always their fault.

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Well, it's a tax on property, not on people. The property size/value changes upwards based on how many people live there?

More people in a house usually depreciates it faster, more wear and tear and more people using city services. The more occupancy on a property, the higher the tax should be.

[scaphism]

Rent is way less. A 2 bedroom is like $1000-1500 a month lets say. A far cry from what a mortgage is gonna cost. Plus the renting fee usually includes electricity, taxes and other utilities.

thats actually wrong, in many cases paying for a home is cheaper than rent.

[Deleted]

you dont english very well do you. get your troll game up bro, you slacking

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yeah cause you totally owed housing and food for being born. you dont have to provide for yourself, we got it bro. is what you want to hear, but reality be like, yo fucker get out and do something or die in the streets hungry.

Why is there more debt in the world then money? Because it enslaves people.

There's 0 need for jobs and money. Society can sustain itself because only a very few would sit on their asses and do nothing all day.
The big change you'd get is everyone would do something they love to do. Some would grow crops, some would stack the shelves in the supermarket and so on. People that love to cook will cook in a restaurant and people that like to entertain entertain. Not because of profit or to earn a wage, but because they would be bored otherwise and they want to.

Money and especially the concept of profit only benefits the very top of society. So whats your motivation to do what you do?