Fixed as in fixed to extract the most amount of money out of you

Tldr there is literally no reason for this product to ever exist. It mathematically makes no sense. Banks won’t offer it. Investors won’t back it. You’ll have no incentive to take it.

The 50 year mortgage isn’t just a bad product. It’s a predatory product.

Interest is the cost of borrowing, plus a little extra tacked on for the capital the banks and investors tied up in the loan. Generally speaking, the longer you borrow, the higher your rate. It’s usually better to borrow for as little time as you feasibly can because it’s the double whammy of paying off that front loaded interest faster and clearing the payment from your own books sooner.

The thing with borrowing over time is that there’s a diminishing return with more time. Assuming the interest is equal on a 30 year vs a 50 year mortgage, your payments go down maybe 15%. So assuming that $3,000 payment at 5% for 30 years vs 50 years, your 50 year payment is $2,538. Which sounds nice until you multiply payment amount by number of payments and find that the total cost of borrowing goes up >$442,000.

But you absolutely will not get the same rate on a 50 year vs a 30 year. It’s too risky for investors to back it, no matter how you slice it. They’ll want more interest on top of it if they do. So your rate might climb to 6.25% over the 5% you might have got on the 30 year loan. That changes the payment from $3,000 to $3,046.

Yep. The payment can be higher. Again, law of diminishing returns and higher rates because more risky.

So a recap. You’re financing $558,845 after down payment, earnest money, closing costs, etc. With a 30 year term, you’re looking at 5%. The payment is $3,000 a month so you ultimately pay $1,080,000 for the house. At 50 years, you’re borrowing at 6¼ and paying $3,046 a month, so now the house costs you $1,827,600. Not only is your payment higher, but the house is ¾ of a million bucks more expensive! How generous!

This doesn’t even factor in the extra 20 years of PMI you’ll have to pay because if you have to borrow for 50, we all know you’re not putting 20% down.

If you can borrow for 15 years, that’s going to be the best way to secure yourself long term. But 30 year mortgages are overwhelmingly common because prices are too high. Even so, they’re not a bad product.

But absolutely do not fall for this 50 year bullshit. The average first time buyer is in their forties now. Only a handful of us will live long enough to pay that off. You’re probably better off renting for the rest of your life than taking a 50 year mortgage.

Correct, it is a long term cash grab. And if one day you can’t pay the mortgage then they foreclose and you get nothing. It’s just a really long term rental, paying interest along the way.

Am I stupid, or is that the equivalent of using a novelty check for like $25 for these rich motherfuckers? That seems like it would be chump change for them.

I have an annuity but I neeeeed cash nowwwww

They infected us all.

Sorry, mate, we’re all out of cake. All we have left is death.

The irony of your statement and your username.