To read the article, just put a period (.) at the end of the domain. Eg. domain.com/article --> domain.com./article
Or block javascript for this domain in the chrome settings.
Wealthy mortgage borrowers face cold shoulder from lenders
161–170 of 191 posts
Re: Wealthy mortgage borrowers face cold shoulder from lenders
#162Earlier quoted context omitted.
Do you know why does it work?
It didn't work for me. Instead it said I'm in private mode and said I should subscribe to keep reading. I'm using Firefox FWIW.
This https://pastebin.com/UiyghKpq userscript should fix it. I found it few years ago somewhere on reddit. It works on multiple media sites that don't like private mode.
And "Bypass Paywalls" firefox addon removes the need to insert the dot into address.
Re: Wealthy mortgage borrowers face cold shoulder from lenders
#163Earlier quoted context omitted.
The central friction is there are two conflicting views of banking: 1) Lending, insurance, and investment as a social service. People need homes. Businesses sometimes need to weather crises without bankruptcy. Startups need funding. People need educations. 2) Lending as a private investment. You want interest rate to reflect risk. Evolving monetary theory means federal interest rates are set to reflect #1. The underl…
There isn't some fundamental distinction between 1 and 2. For 1, there is obviously some positive social utility in the end or else it wouldn't be good policy. But such lending may require too much capital, too large a risk pool, or too long a time horizon for an individual private bank to take on. Instead a public or policy bank steps in. It's good to have banks of different sizes serving different niches, as long a…
That's why the fed was set up -- to make sure monetary policy is decoupled from short-term political objectives. It ain't perfect, but it's ain't bad either.
We could do better than the Fed in 2020. Tech makes transparency easier.
Re: Wealthy mortgage borrowers face cold shoulder from lenders
#164Re: Wealthy mortgage borrowers face cold shoulder from lenders
#165Earlier quoted context omitted.
Truth.. me and my spouse sold our old house in san jose (2016) to a couple who had < 160k in 401k combined(no other assets) and were in their mid/late 50's, their downpayment was the 90k they got from the sale of their condo, they were in construction/design(unsure of income) and had to get a 2nd loan from the bank to make the downpayment. Their total new mortgage is 5k a month(payment and prop. taxes, guessed this),…
I wonder if this means a foreclosure crisis is coming. I've wondered recently how much of this house price inflation is because of cash buyers from China vs. cash buyers because they sold their stock in a unicorn vs. dual-FAANG-engineers with a mortgage vs. people who leveraged up to the hilt with 3-5% down adjustable mortgages. ChuckMcM posted county property records a couple years ago that suggested the former cate…
A few years back I found a website where I could look up big expensive houses on the east bay area hills and it would mention who owned them. When I looked up a few of the big ones, 8 of 10 I looked at were owned by doctors.
Re: Wealthy mortgage borrowers face cold shoulder from lenders
#166Typical non rigorous find a few examples and write a story article. Not saying not true either just that getting a few people to say something is not a trend or show what is happening in most places (possibly).
That said we just did a refi which closed today. (My own single data point anecdote).
It does make sense that the risk is greater for the mortgage companies now than in typical times in the sense that traditional borrowers who were secure and non risky in a regular economy could potentially be out of work and have a greater chance of default with the security not being worth that much.
Re: Wealthy mortgage borrowers face cold shoulder from lenders
#167Earlier quoted context omitted.
First of all, a $1M house with $200k down means an $800k mortgage, not a $1M mortgage. With rates as ridiculously low as they are, monthly payments are closer to $3.5k/mo. Add in an amortized $500/mo in property tax and you're at $4k/mo, for about 39% of income, not 48%. For that married couple making median income (filing jointly), after the mortgage interest tax deduction I think it's like 46% of their after-tax ta…
Your numbers are way off - dangerously so. First, nobody is getting a sub-3% fixed 30 year mortgage right now - so your minimum for principal+interest on your 800k loan is already $3656 (assuming you can get 3% - every half% is going to cost you roughly another $350 per month) Next, your estimate for property taxes is similarly low. I don’t live in CA but where I live taxes are roughly 1% of the assessed value. Let’s…
Looking at three different calculators from googling "mortgage calculator," I get an $800k loan at 3.25% (higher than the rate I pay on mine in SF, but I paid the rate way down) coming to $3,482/mo for principal and interest.
For property tax, i found this california property tax calculator [0], which says it's $6,490/year ($541/month) for a home assessed at $1M in SF. That brings us to $4023/mo.
You're right I totally forgot about insurance. Oops. Sure let's use $150/mo, but IIRC that's more than I pay on mine. Maybe because I'm in a big building and the HOA has insurance for parts that I'd need to insure if it were a single family home? But I didn't factor in HOA, so $150's fair, even cheap.
$3482+$541+$150 = $4173/mo.
I still think this median household is going to have something like $4-5k/mo left over after principal, interest, property tax, insurance, and income tax. That's the most important number to get right in terms of how accessible this is. It tells us how much to they have to squeeze on everything else to make it work.
[1] https://smartasset.com/taxes/california-property-tax-calcula...
... also "$4556... representing one trip to Disney world’s worth of extra spending over the year." Holy shit really? I never would have guessed disney world is that expensive. Daaaaamn. Guess I'm never going there :(
(on second thought, I think you're right about the property tax estimate being low. I pay more than the online calculator said and my place is assessed below $1M. Maybe it's all the other stuff tacked on in SF? Add maybe ~$200/mo to my above estimate, we're still talking about something like $4k/mo left over)
Re: Wealthy mortgage borrowers face cold shoulder from lenders
#168Re: Wealthy mortgage borrowers face cold shoulder from lenders
#169> Before the pandemic, lenders were falling over each other to welcome jumbo borrowers, who generated fat profits even though they were the least likely to default. Even though? Implying loans that default are normally the most profitable? Am I misreading this?
Loans that are likely to default have higher interest rates. However, jumbo loans also have high interest rates due to the size of the principal. Although they're supposed to be less likely to default, being held by high-income individuals, if they do default then you lose more principal than a regular loan. For a bank in good times, you get to charge high interest rates normally reserved for risky borrowers on safe…
But in a well working market, why wouldn't bank X provide a lower rate than bank Y if the loan is less risk and very profitable? And then bank Z sees a potential profit and undercuts bank X. Repeat until you get a rate that reflects the risk?
So the real question is: What is wrong in the high-end US mortgage market? Are banks breaking anti-trust laws and setting price floors?
Re: Wealthy mortgage borrowers face cold shoulder from lenders
#170Earlier quoted context omitted.
That is not at all what china does. China has a huge banking sector, much bigger than the US. And no ... almost all of those banks are independent of the central bank. US and Chinese systems are very similar. Europe is a bit different. England, spain, italy, don't really have the large number of small and mid sized banks that the US or China does (germany does have many small banks however... noticing a trend? small(…
Are you trying to suggest that diversity in banks leads to a market having more industry, or that more industry leads to more diversity in banks? And what is the cause and effect?
domestic credit finances, and is the best way to finance, industrial expansion