As always I enjoy your selection of reading focuses.
On a separate, but related note, I have never really understood the justification for the business of Mortgages (or as the antecedent meaning of the term as derived from the French language’s meaning-a contract until death, because such contracts were understood to be a lasting lifelong repayment plan all the way to death), and more to the point for me personally is why should anyone pay 200% or greater for interest payments on the original property sales price? I find it difficult to justify such an obviously greed-based system of financing.
It is my personal opinion that property financing should be capped and an end to the greed absolutely must be enforced.
Thanks, Robert! I think the idea of capping property financing makes a lot of sense. After all, if you don't pay the bank, they can take your house - That is, banks say the scheme is necessary to protect their investment - but property owners are highly-incentivized to make the repayments. No need to add to that crazy interest payments that can result in, as you note, paying 200% of the original value for a property. Moving to a fixed interest financing scheme might help with this.
Correct me if I am, but is not such a high interest schema the very definition of Usury? Just because the APR is a low single digit figure does not mitigate the fact that the end result over the lifetime of the loan produces an exorbitant profit margin for the lenders while the borrowers must endure the constant threats and pressures that come with entering into such lopsided agreements.
It seems to me that people in general need to say NO! And refuse to accept such obviously greed driven situations.
I have had many conversations with different people across the spectrum of working adults and it always seems to end up with most people just complacently accepting the situation as unalterable or in many cases people have looked at me as if what I have to say could only come from a crazy person. It saddens and enrages me to witness such compliant, obedient, submission all in service to corporations and greed.
People, from my perspective, have been slowly but surely programmed to defer to business interests over and above their own personal situations; and that truly and genuinely makes me angry, for their them, even if they do not understand what is at stake themselves.
That's right - though most advocates refer to usury relative to interest as reflected in APR. Still, as you note, the current system creates a huge imbalance in favor of the lender - and results in lenders getting super rich off of mortgages (most of which are repaid in a timely fashion) - Using a fixed interest scheme could allow for potentially higher rates (say 10% of the purchase cost) spread out over the life of the loan. That would still give the banks a ton of money (likely more than the cost of servicing the loan) and would be more balanced for the borrower. Heck, you could go to 20% of the cost and still create a scenario that is a significantly better deal for the buyer/homeowner than what is allowed today.
Say you buy a $500,000 home - you then pay a 20% charge in fixed interest and then spread the payments of $600,000 over the 15 or 30 year mortgage. The bank gets $100,000 for the fairly easy work of servicing your loan - plus, they can still foreclose if you fail to pay, meaning their risk is mitigated significantly and they are very likely to be repaid in one form or another.
That's a win-win. Banks sill make big money, homeowners get significantly more manageable payments.
As always I enjoy your selection of reading focuses.
On a separate, but related note, I have never really understood the justification for the business of Mortgages (or as the antecedent meaning of the term as derived from the French language’s meaning-a contract until death, because such contracts were understood to be a lasting lifelong repayment plan all the way to death), and more to the point for me personally is why should anyone pay 200% or greater for interest payments on the original property sales price? I find it difficult to justify such an obviously greed-based system of financing.
It is my personal opinion that property financing should be capped and an end to the greed absolutely must be enforced.
Thanks, Robert! I think the idea of capping property financing makes a lot of sense. After all, if you don't pay the bank, they can take your house - That is, banks say the scheme is necessary to protect their investment - but property owners are highly-incentivized to make the repayments. No need to add to that crazy interest payments that can result in, as you note, paying 200% of the original value for a property. Moving to a fixed interest financing scheme might help with this.
Correct me if I am, but is not such a high interest schema the very definition of Usury? Just because the APR is a low single digit figure does not mitigate the fact that the end result over the lifetime of the loan produces an exorbitant profit margin for the lenders while the borrowers must endure the constant threats and pressures that come with entering into such lopsided agreements.
It seems to me that people in general need to say NO! And refuse to accept such obviously greed driven situations.
I have had many conversations with different people across the spectrum of working adults and it always seems to end up with most people just complacently accepting the situation as unalterable or in many cases people have looked at me as if what I have to say could only come from a crazy person. It saddens and enrages me to witness such compliant, obedient, submission all in service to corporations and greed.
People, from my perspective, have been slowly but surely programmed to defer to business interests over and above their own personal situations; and that truly and genuinely makes me angry, for their them, even if they do not understand what is at stake themselves.
That's right - though most advocates refer to usury relative to interest as reflected in APR. Still, as you note, the current system creates a huge imbalance in favor of the lender - and results in lenders getting super rich off of mortgages (most of which are repaid in a timely fashion) - Using a fixed interest scheme could allow for potentially higher rates (say 10% of the purchase cost) spread out over the life of the loan. That would still give the banks a ton of money (likely more than the cost of servicing the loan) and would be more balanced for the borrower. Heck, you could go to 20% of the cost and still create a scenario that is a significantly better deal for the buyer/homeowner than what is allowed today.
Say you buy a $500,000 home - you then pay a 20% charge in fixed interest and then spread the payments of $600,000 over the 15 or 30 year mortgage. The bank gets $100,000 for the fairly easy work of servicing your loan - plus, they can still foreclose if you fail to pay, meaning their risk is mitigated significantly and they are very likely to be repaid in one form or another.
That's a win-win. Banks sill make big money, homeowners get significantly more manageable payments.