What happens to mortgages during hyperinflation? | |
Anonymous Coward User ID: 76903646 United States 10/01/2018 07:55 PM Report Abusive Post Report Copyright Violation | With all the talk and rumors of a coming worldwide economic carsh lately, was wondering this: Quoting: Sikhed Let's say you buy a house in calm economic times. You put half down, get a 30 year mortgage, and pay $1000/mo at 6%. Then hyperinflation hits. A cup of coffee costs $1 million, like in Venezuela and Zimbabwe. What happens to your mortgage? (assuming the banks are still standing) Do you pay it off with your pocket change? Or is there a catch? (I recently read mortgage papers, 15 pages of it, and don't see any clause about money becoming worthless. But then again, I'm not a lawyer either) Thanks in advance for your input. As long as you chose a fixed rate (not variable) you pay your entire mortgage off with 3 loaves of bread. :truestory: |
Anonymous Coward User ID: 76903646 United States 10/01/2018 07:56 PM Report Abusive Post Report Copyright Violation | |
NervousAndJerky
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swamprat
User ID: 35582214 United States 10/01/2018 07:58 PM Report Abusive Post Report Copyright Violation | The house I could barely afford in my 20's became quite a bargain in my 30's. A combination of inflation and better jobs and wages. We aren't cut out to be socialists.We are the people who couldn't be constrained by Europe. We are the malcontents, idealists, speculators, dreamers, inventors, debtors and criminals who would not be chained. We don't play well with others, we are brash, outlandish and cunning. let us do what we do best; let us be Americans. |
MeisterEder.
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Sikhed
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Evolution16
User ID: 76947662 Croatia 10/01/2018 08:01 PM Report Abusive Post Report Copyright Violation | Your payment doesn't change, assuming fixed rate, and your home value goes through the roof. You just pretty much have to stay in your home - unless they invent a portable mortgage. Your next house will cost 1 trillion and have an interest rate of 1658% per month. Probably ought to stay put until things calm down. Government is best which governs least - Jefferson |
Anonymous Coward User ID: 76991209 United States 10/01/2018 08:03 PM Report Abusive Post Report Copyright Violation | |
Mental Case
User ID: 738448 United Arab Emirates 10/01/2018 08:08 PM Report Abusive Post Report Copyright Violation | You just never know. The bank could recall the loan immediately. If it's an official government devaluation of currency then they MIGHT also index all debt to the percentage of devaluation. If market forces devalue the currency then you MIGHT be able to pay off your mortgage with pocket change. Hyperinflation is a wild animal & very unpredictable. If I am going to be damned...I am going to be damned for who I really am! |
Outland
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Movalong
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Russian hacker
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Movalong
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Blue Wave
User ID: 75396617 Singapore 10/01/2018 08:24 PM Report Abusive Post Report Copyright Violation | Thanks. Personally, I'm fixed at 6.93% With only 6 years left. (and no 2nd mortgage either) Quoting: Sikhed Seems to good to be true. Makes a person kinda look forward to economic doom. Why didn't you refinance a few years ago? I refinanced to a 15 year mortgage at 2.62%. Even my 30 year prior to the refinance was 5.25%. You've been paying way too much in interest. Blue Wave is coming |
BRIEF
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Sikhed
(OP) User ID: 5898996 United States 10/01/2018 08:25 PM Report Abusive Post Report Copyright Violation | Thanks. Personally, I'm fixed at 6.93% With only 6 years left. (and no 2nd mortgage either) Quoting: Sikhed Seems to good to be true. Makes a person kinda look forward to economic doom. Why didn't you refinance a few years ago? I refinanced to a 15 year mortgage at 2.62%. Even my 30 year prior to the refinance was 5.25%. You've been paying way too much in interest. I have no credit score. Private loan. :doom360: |
MeisterEder.
User ID: 76894382 Germany 10/01/2018 08:26 PM Report Abusive Post Report Copyright Violation | Debt gets paid all the time. [link to www.youtube.com (secure)] MeisterEder |
Blue Wave
User ID: 75396617 Singapore 10/01/2018 08:26 PM Report Abusive Post Report Copyright Violation | Thanks. Personally, I'm fixed at 6.93% With only 6 years left. (and no 2nd mortgage either) Quoting: Sikhed Seems to good to be true. Makes a person kinda look forward to economic doom. Why didn't you refinance a few years ago? I refinanced to a 15 year mortgage at 2.62%. Even my 30 year prior to the refinance was 5.25%. You've been paying way too much in interest. I have no credit score. Private loan. No credit or bad credit? Blue Wave is coming |
Movalong
User ID: 76355751 Slovakia 10/01/2018 08:31 PM Report Abusive Post Report Copyright Violation | You just never know. Quoting: Mental Case The bank could recall the loan immediately. If it's an official government devaluation of currency then they MIGHT also index all debt to the percentage of devaluation. If market forces devalue the currency then you MIGHT be able to pay off your mortgage with pocket change. Hyperinflation is a wild animal & very unpredictable. |
Mental Case
User ID: 738448 United Arab Emirates 10/01/2018 08:32 PM Report Abusive Post Report Copyright Violation | ------- But you can't sell the house because nobody has the cash upfront & the banks stop lending in a hyperinflationary invironment. If I am going to be damned...I am going to be damned for who I really am! |
Sikhed
(OP) User ID: 5898996 United States 10/01/2018 08:34 PM Report Abusive Post Report Copyright Violation | No credit. Never played that game. And I'm almost 60. Last Edited by Sikhed on 10/01/2018 08:35 PM :doom360: |
Monty Python
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Sikhed
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Movalong
User ID: 76355751 Slovakia 10/01/2018 08:47 PM Report Abusive Post Report Copyright Violation | Debt gets paid all the time. [link to www.youtube.com (secure)] This time is different because 1) the whole world uses currencies backed by farts of central bankers; 2) the whole world is saturated with debt. |
Kodiak Island
User ID: 76842541 United States 10/01/2018 09:18 PM Report Abusive Post Report Copyright Violation | With all the talk and rumors of a coming worldwide economic carsh lately, was wondering this: Quoting: Sikhed Let's say you buy a house in calm economic times. You put half down, get a 30 year mortgage, and pay $1000/mo at 6%. Then hyperinflation hits. A cup of coffee costs $1 million, like in Venezuela and Zimbabwe. What happens to your mortgage? (assuming the banks are still standing) Do you pay it off with your pocket change? Or is there a catch? (I recently read mortgage papers, 15 pages of it, and don't see any clause about money becoming worthless. But then again, I'm not a lawyer either) Thanks in advance for your input. As long as you chose a fixed rate (not variable) you pay your entire mortgage off with 3 loaves of bread. Not true. The banks will always be able to change rules and law because, well, they are banks and they have all the money. The reason I know this is because I read about it happening somewhere before and the banks did indeed change the rules so they didn't get screwed. The banks will never lose! So, no, I don't think you will just be able to pay it off in inflated dollars, at least not all of it. Perhaps at the beginning of hyperinflation you might, until the banks get around to changing their mortegage rules. Kodiak |