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Inflation won’t do anything to your fixed-rate debt, but hopefully it will increase your wages to make the debt easier to pay.
by herge 8y ago
Inflation won’t do anything to your fixed-rate debt, but hopefully it will increase your wages to make the debt easier to pay.
- justonepost 8y agoIt will also increase the value of your house. Fix rate debt is definetly your friend.
- jgalt212 8y agoFixed rate debt may increase the value of your house if interest rates go up and your mortgage is assumable.
- toomuchtodo 8y agoAlmost no US mortgage products are assumable.
- gibybo 8y agoAll US government home loan programs are assumable (FHA, VA, and USDA). This Quora answer indicates that FHA loans alone alone make up a majority of new home loans in the US: https://www.quora.com/What-percentage-of-US-home-loans-are-financed-by-FHA https://www.quora.com/What-percentage-of-US-home-loans-are-f...
- toomuchtodo 8y agoI should've said conventional loan products. Thank you for pointing out my mistake.
- djrogers 8y agoWhile they make up the moajority of new home loans, they only make up ~15% ot total mortgage originations, leaving 85% of homes being mortgaged with conventional mortgages.
- beiller 8y agoI disagree. If inflation is very high, the fed (aka BOC for me) will increase the interest rate, and by correlation, a higher mortgage rate ensues. Less people qualifying for mortgages attacks the demand side of the market, lowering the prices of homes.
- patmorgan23 8y agoMost US mortgages have a fixed rate for 20 - 30 years with no balance further due at the end.
- cortesoft 8y agoI meant the inflation adjusted value of your debt.