Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Danes Get 20-Year 0% Mortgages

bloombergquint.com

Post reply on HN
Print view View original

301–310 of 331 posts

Re: Danes Get 20-Year 0% Mortgages

#301

Post by [deleted] »

kev009 wrote: post #282
znpy wrote: post #249

Earlier quoted context omitted.

> When I decide to buy a $25k car because that's as much as I'm willing to spend I still need to determine what my "monthly" is. I haven't owned a car and i'm almost 30, and have always enjoyed public transport so far. When I'll decide to buy a car, I'll just f-ing pay it in full and be done with it.

Car loans are 0% for anyone with good credit right now. We live in a managed economy now sadly, so you are actually throwing away money by paying outright instead of taking on interest-free debt and doing almost anything else with the theoretical reserve-principle; even sticking it in a checking account is going to be a net gain.

[deleted]

Re: Danes Get 20-Year 0% Mortgages

#302

Post by sgerenser »

elindbe3 wrote: post #131
Hamuko wrote: post #124

Earlier quoted context omitted.

Do Americans always have fixed interest rates?

No, there are fixed and variable rate mortgages.

Although fixed rate mortgages are far more popular because they are subsidized by the federal government. Right now I can choose between a 15 year fixed rate mortgage at 2.375%, or a 30year fixed at 2.75%, or a 5/1 adjustable for 2.75%. Obviously nobody is picking the adjustable rate.

Re: Danes Get 20-Year 0% Mortgages

#303

Post by sizzle »

nostrademons wrote: post #274
adam_arthur wrote: post #179

Earlier quoted context omitted.

Certainly true. Though higher price with lower rates, assuming monthly payment is the same, can be beneficial as a larger percentage of your payment goes towards principal. That only holds as a positive if price doesn't drop due to interest rate increases. But I'd definitely rather be buying a house in a high interest rate environment... don't like the tail risk given how low rates are.

> But I'd definitely rather be buying a house in a high interest rate environment... don't like the tail risk given how low rates are. Don't forget the tail risks of inflation. The risk of not buying a house in a low-rate environment is that inflation takes off, the price of the house goes up 10x to match the price of everything, your rent goes up alongside everything else, but the people who bought still have the sa…

You seem very knowledgeable on the market trends. What do you think the effects of COVID-19 will have on the market, given unemployment broke records and all that?

Re: Danes Get 20-Year 0% Mortgages

#304

Post by sifar »

ganeshkrishnan wrote: post #296
apta_ wrote: post #238

Earlier quoted context omitted.

As a Muslim, almost every "Shariah compliant" financing contract I came across is not compatible with Islamic Law (Shariah). Unfortunately, we're just taking modern parasitic and usurious financial contracts, and wrapping them under "Islamic" terms, and selling them as such. Any actual investigation of such contracts reveals that they're nothing but interest and usury in disguise. Islam seriously warns about this sor…

>we would immediately rule out things like stock shorting, put and call options, margin and leverage trading, mortgages, interest bearing loans, selling debt for debt, and so on. These are the very foundations on which modern society is built and which drives the entire humanity forward. Sure, some people have managed to race ahead but on a whole we, as humans, have progressed from clubbing each other for food to arg…

That is a sweeping (and incorrect) generalization. Except the credit part, all the other things are optional.

And even for credit, I am not sure interest is needed. That leads to the world devouring growth that we have.

Just because we inherited a world where these things exist, the tendency to attribute them all to these things is not wise. I don't know what to call this fallacy.

Re: Danes Get 20-Year 0% Mortgages

#306

Post by sifar »

0xfaded wrote: post #130
supernova87a wrote: post #66

There is a more basic economic question that I am curious about. I don't know how / can't believe how in the 1980s we had the era of 15% interest rates, etc (ok, I have some idea, central bank policies, inflation, etc) -- but it seems now we're in a "forever-0%-interest" situation. The reason I think is that interest/mortgage/etc rates just reflect how much people/banks/etc are willing to receive in profit for parkin…

In Denmark's case, the rates are set to defend the krone's peg against the euro. Denmark being above average in terms of stability within the euro zone sets negative rates to shoo people from parking their money there, which would otherwise drive demand and increase the exchange rate for the krone. In Europe as a whole, yes, it is in deep stagnation. There is no where near enough investment opportunity for the wealth…

>> If you really want a laugh, read up on how banks are competing to acquire physical currency because cash is cheaper to store in a guarded vault than a database entry with the ECB.

Hahaha, so as the governments the world over propagandize (read black money/corruption) people to move to digital cash the banks are legally allowed to hold mountains of them. And ...even charge people a fee to withdraw there own money as cash.

https://www.bloomberg.com/news/articles/2020-01-31/german-ba...

Re: Danes Get 20-Year 0% Mortgages

#307

Post by im3w1l »

eloff wrote: post #300
im3w1l wrote: post #117

Earlier quoted context omitted.

It's very different, because it means you don't need the borrower to ever pay back. Meaning the banks will give loans to anyone the laws can be bent to allow lending to.

That doesn't make logical sense to me. The back would still lose the principal if you defaulted right? Doesn't matter the interest rate.

The customer can't default if there is no interest, so just let the debt remain on the books forever. Well, I suppose you could take a loss if your customer dies, and the estate is insolvent.

Re: Danes Get 20-Year 0% Mortgages

#308

Post by ashtonkem »

ageitgey wrote: post #13

My friends in Geneva tell me that this has been a thing there for a long time. It has some pretty bizarre effects on the market (according to my friends): 1. House prices rise to the point where the down payment is essentially the price of the house. The house price itself becomes imaginary. What you are really worried about is the down payment. 2. Since house prices are now super high, only people who have saved up…

Typically speaking home prices tend to fluctuate based on interest rates, because home buyers actually purchase based on what they can afford on a monthly basis, not what the actual list price of the house is. I imagine at such low rates, the effect must be pretty strong though.

Re: Danes Get 20-Year 0% Mortgages

#309

Post by [deleted] »

asiando wrote: post #148
matwood wrote: post #143

Earlier quoted context omitted.

> 1. House prices rise to the point where the down payment is essentially the price of the house. The house price itself becomes imaginary. What you are really worried about is the down payment. Yes and no. This is also true in all markets. No one really buys a house based on the price. They buy it based on the monthly payment (price - down payment and interest rate). The price alone is mostly irrelevant for the buye…

> The price alone is mostly irrelevant for the buyer. Sorry but wow. This is not the kind of comment I expect on HN, but rather from my uncle: “We got this new Lexus, it’s only $500/month!” “Yes, for 200 years”

[deleted]

Re: Danes Get 20-Year 0% Mortgages

#310

Post by ashtonkem »

mason55 wrote: post #153
matwood wrote: post #143

Earlier quoted context omitted.

> 1. House prices rise to the point where the down payment is essentially the price of the house. The house price itself becomes imaginary. What you are really worried about is the down payment. Yes and no. This is also true in all markets. No one really buys a house based on the price. They buy it based on the monthly payment (price - down payment and interest rate). The price alone is mostly irrelevant for the buye…

Yeah we had a long-term plan to buy a house this summer and we stuck to our plan but it's definitely scary thinking about what will happen when interest rates rise, if we ever wanted to sell. I guess the counterpoint is that the whole market should move in lockstep, so if rates go up and the price of your house goes down, at least the rest of the market should be affected equally. It kills any idea of getting a real…

Your local area matters a lot too. Is your city gaining or losing population? Is there new development adding units onto the market, or have NIMBYs locked it up? Do local tax laws incentivize long term owners over short term owner? All of these can have an effect that'll blow interest rates out of the water.
Post reply on HN