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Whoever gave you the loan knew that, and they adjusted the interest rate and conditions to still make it a good deal for them. If inflation had been lower, the
by thomasahle 5y ago
Whoever gave you the loan knew that, and they adjusted the interest rate and conditions to still make it a good deal for them. If inflation had been lower, the loan's interest would have been too.
- Retric 5y agoThese aren’t independent variables as people on average can only pay so much for housing per month. High interest rates lower the value of properties to keep things sufficiently affordable. Thus low inflation is actually really bad for first time home buyers who can a just afford the mortgage in year 1 and likely still just afford the mortgage in year 15.