£200,000 mortgage - 5% interest - 25 year repayment.
Total interest = £150,754 thus for your house you have paid a total of £350,754 which is 175.5% of the original price.
Do you think this is fair?
An organisation that makes billions in profit every year get to make money because they have money. What makes them rich...YOUR money!
Banks, insurance companies, etc, the whole lot produce NOTHING at all but they have money so they get richer. They will fleece each customer for all much profit as possible so laying of staff where possible and lowering your customer service where possible.
Any short cut - call centres in India, no chance of seeing a manager, closing down branches and yet still make the billions.
If you think about the extra years you have to work then it might add to your concerns:
For the UK average wage (£21000), to pay off the extra interest you need to work for 16.7 years.
So you want to work nearly 17 years to line someone elses pocket? I don't think so. A con.
2006-10-18 23:53:52 · 9 answers · asked by Anonymous in Business & Finance ➔ Personal Finance
Some of you ask how to avoid mortgages - I do not have the space here to fully explain how to deconstruct capitalism.
However, the government could be used to distribute land registration and to make the balance transfers - you voted for them, make them do something useful.
You pay the house value in installments - just like rent but for every payment, you are purchasing more shares in your house.
For example, house is valued at £100,000, every month you pay £300 buying 1% of house...
After 27 years 9 months - you own the house outright, you have worked less years to pay it off and no greedy midddleman has made a penny.
OK?
2006-10-19 00:11:59 · update #1
Correction - you buy 0.3% every month, oops.
2006-10-19 00:13:49 · update #2
How about, while we're at it we ban taxes too.
How else would you be able to afford a house that is say 300,000 US dollars other then to get a loan and for the service of a loan the bank has to charge something or else they wouldn't exist, do you know anyone that is going to loan out money and just not expect anything back.
I know that I could never have afforded my house by just saving money, there is just no possible way, ok maybe if I live in a card board box on the street for the 25 years that it would take to pay off the loan that I should have gotten in the first place.
So what if they are making good money off of you. If it bothers you that much change your career, be a mortgage broker.
2006-10-19 00:03:48 · answer #1 · answered by Anonymous · 0⤊ 0⤋
And how do you propose people should fund the purchase of a home? Save up whilst paying rent? The only new homes being built would be retirement communities. The idea of interest is that it compensates a lender for the time value of money. The general principle seems fair to me. Does that mean that banks abuse their power? Yes it does. Should they be forced to adopt fair lending practices? Of course. Who was the last Prime Minister to try anything like that? Margaret Thatcher and even she failed. All we got was a one-year Windfall Profit tax on the banks. Bring back Maggie and let her have another go!
Your other point regarding the call-centres in India (and other places now) is well-made. Personally, I would charge any company who does that (not just banks) a tax which corresponds to the PAYE/NIC lost over a period of, say, 10 years. That would help fund job creation in other industries and a lot more besides. It would also concentrate multi-nationals' minds.
2006-10-19 07:05:30 · answer #2 · answered by skip 6 · 0⤊ 0⤋
So what do you propose ? We should rent ? If we do that the rent would have to be enough to cover the cost of the mortgage and running and repair costs of the place, and give the actual owner a profit, so it would be even more expensive than mortgaging, and you also don't own the place.
Also bear in mind that property inflation exceeds the mortgage rate by a good margin which means that at the end of the mortgage term you will own some bricks and mortar worth far in excess of the amount you have paid.
Win-win situation I think.
2006-10-19 07:13:00 · answer #3 · answered by Anonymous · 0⤊ 0⤋
I've always thought it was a huge rip off. Housing should be affordable and available. Or at least interest rates and housing prices should be stable. The only advantage we seem to have is a tax break, but I fear too someday they'll take it away...........
2006-10-19 07:10:12 · answer #4 · answered by <><><> 6 · 0⤊ 0⤋
Would be nice but as long as there is money to be made, big business and the banking industry will never let that happen......
2006-10-19 07:02:46 · answer #5 · answered by parrothead2371 6 · 0⤊ 0⤋
if would be great to ban them but unfortunately people need mortgages to buy houses as they dont have the money to otherwise! its sad but true!
2006-10-19 07:02:36 · answer #6 · answered by Jess B 2 · 0⤊ 0⤋
Great idea! Nobody will own property, everyone will pay rent and never build any equity.... great idea!
2006-10-19 07:53:55 · answer #7 · answered by Adios 5 · 0⤊ 0⤋
yes, it would be nice to do that, but I don't ever see that happening , take care
2006-10-19 06:59:34 · answer #8 · answered by start 6-22-06 summer time Mom 6 · 0⤊ 0⤋
yes we should ban them
2006-10-19 06:56:24 · answer #9 · answered by ? 7 · 0⤊ 0⤋