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We're talking about teenagers, not adults with several years of household finance experience.
by ric2b 5y ago
We're talking about teenagers, not adults with several years of household finance experience.
- loonster 5y agoIt doesn't matter. People care more about the monthly payment than they do the debt #. You can afford a much higher debt burden if the interest rate is smaller. For fun, assume you can afford $1000/month in housing costs. With a 30yr mortgage and 20% interest rate. How expensive of a house can you afford? What if interst rates dropped to 10%? 5? 2.5? Very strong correlation with home prices over the last 40 years.