You are viewing a single comment's thread from:

RE: A BRILLIANT NEW MORTGAGE CALCULATOR METHOD FROM PAPA-PEPPER

in #money7 years ago

I agree we need to be very conscientious before using any debt instruments. Unfortunately it is too easy to get buried in loans.

While I agree with the calculations, I think looking at interest paid is a little misleading. If inflation (including wages) continues it should cost you less in real purchasing power overtime. In your example a 200k, 30yr mortgage @5%, the final payment of $1074 is only worth ~$248.5 in today's dollars. A mortgage can be viewed as a tool that can free capital to create an inflation hedge.

Sort:  

Yes, this is an important point to add into the equation. Inflation erodes the value of the debt and the monthly payments.

This is what Western Governments are trying to do - inflate away the value of (country) debt by printing money!

Exactly pay off that dollar I get today with $.90 tomorrow. Now if the western governments could find a way to spend less it might actually work!

Sure, I could see that. Thanks for bringing another viewpoint into it.