This is all ignoring that the government is the one paying the front risk for home loans to begin with. The fact banks have the audacity to charge interest, which was created to mitigate risk they don’t actually incur, makes the entire system redundant and quite literally a socialist creation.
I agree that some of their risk measures are redundant, like PMI in case you can't pay the mortgage, but they can also simply repo the house if you don't pay, what is the point of both?
That said, what is your alternative to them charging interest? What if someone wants to buy a home but doesn't have the funds to pay in full. What then?
Why are the banks charging interest to cover risk that is paid for by the government? When’s the last time banks actually lost money from home loans? Again, we socialized losses for banks but for some reason privatized profit.
That's a series of questions, but not an answer. I can infer, but I'd like you to actually explain the alternative? Just, take the purchase price and divide it by 360 and call it a day? And what if they miss a payment, or don't pay it off in 360 months? Interest controls for all of that.
Are you really pretending that banks are fronting the risk on home loans? What happened the last time banks took a hit on home loans? Again, government socialized the risk.
This is all ignoring that the government is the one paying the front risk for home loans to begin with. The fact banks have the audacity to charge interest, which was created to mitigate risk they don’t actually incur, makes the entire system redundant and quite literally a socialist creation.
I agree that some of their risk measures are redundant, like PMI in case you can't pay the mortgage, but they can also simply repo the house if you don't pay, what is the point of both?
That said, what is your alternative to them charging interest? What if someone wants to buy a home but doesn't have the funds to pay in full. What then?
Why are the banks charging interest to cover risk that is paid for by the government? When’s the last time banks actually lost money from home loans? Again, we socialized losses for banks but for some reason privatized profit.
That's a series of questions, but not an answer. I can infer, but I'd like you to actually explain the alternative? Just, take the purchase price and divide it by 360 and call it a day? And what if they miss a payment, or don't pay it off in 360 months? Interest controls for all of that.
Are you really pretending that banks are fronting the risk on home loans? What happened the last time banks took a hit on home loans? Again, government socialized the risk.