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Zer Netmouse
February 3rd, 2009
07:12 pm

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Do You Believe in Usury?

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From:sethb
Date:February 4th, 2009 04:34 am (UTC)
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A 30-year loan that charges half the principal in interest is 1.67%. Keep dreaming.

Are you forgetting that the borrower gets the use of the house?
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From:netmouse
Date:February 4th, 2009 12:10 pm (UTC)
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So what, you're saying the borrower is responsible to pay not only interest on the capital loan, but also some sort of rent to the bank?
From:sethb
Date:February 4th, 2009 04:26 pm (UTC)
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No, I'm saying that a house isn't bought for profit but for living in. The bank charges rent (called "interest") for its money. Someone who views a house purely as a financial investment (and isn't planning on renting it out) will make bad decisions.
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From:sethb
Date:February 4th, 2009 10:04 pm (UTC)
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I was ignoring the amortization. Getting a 2.5% mortgage isn't any more likely than 1.67%, though.
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