Traktion Posted September 4, 2011 Share Posted September 4, 2011 Let us suppose they lent your parents a million pounds and they paid off half. When they die, you could either sell the house and pay off the mortgage or continue with the repayments yourself. They are likely to put in stiff penalty clauses for early repayment. The objective is to lend more capital. As always assets rise to reflect the capital available. The net result will be more debt yet exactly the same number of houses. You could lend everyone a billion. So long as interest rates are at 0.0001% it is no problem making the interest payment. The principle could be on a thousand year schedule. Of course this is no different to renting from the bank since you will never own the asset. It depends whether continuation of the debt repayment is forced and whether selling into negative equity leaves the new 'owner' liable. If the above isn't true, as has been said above, it's no different from current interest only mortgages. However, if the above is true, it would violate the liberties of those born into debt bondage (just as government debt does). Link to comment Share on other sites More sharing options...
Zzzzzzzzzzzzzzzzzzzzzzzzzz Posted September 4, 2011 Share Posted September 4, 2011 Intergenerational mortgages mentioned here... http://www.broadsheet.ie/2011/09/02/the-irish-people-are-bonded-servants/ Oh well, at least slaves are getting cheaper. an article from 2006... http://www.guardian.co.uk/money/2006/aug/23/business.mortgages Link to comment Share on other sites More sharing options...
Ah-so Posted September 4, 2011 Share Posted September 4, 2011 I imagine the bank claims against the house as an asset until the mortgage is paid off. Not sure what happens with negative equity though. This must be an issue in Japan. Wasn't it the idea behind only giving 25 year mortgages. So I guess Japan must have a different legal system. While there were news stories at the time about them, I have never met a Japanese with one or anyone who knows anyone with one. The standard Japanese mortgage is 30 years. Link to comment Share on other sites More sharing options...
Darkman Posted September 4, 2011 Author Share Posted September 4, 2011 Why would a thread about MORTGAGES be moved to current affairs?? Link to comment Share on other sites More sharing options...
zappycakes Posted September 5, 2011 Share Posted September 5, 2011 I only heard this in a chat room, and googling didn't reveal links. Maybe someone can do better? But what I heard was Christine Lagarde (new head of the IMF) has suggested intergenerational mortgages. It was at Jackson Hole with Ben Bernanke. Scary stuff indeed. Anyone with more info? Link to comment Share on other sites More sharing options...
zappycakes Posted September 5, 2011 Share Posted September 5, 2011 Darkman, I got the information about Lagarde from a recent edition of The Young Turks, you may have heard it from me at frank taylors lifecast Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.