“Soar” Oppressed

Help meeee! Have I lived too long, have I outlived anybody else who can remember that, decades ago, and for well over decade, interest rates were about 9%?
And that in the early 80s, to the ruin of many idiots who had taken out adjustable rate first or second mortgages, interest rates climbed to 18%?
People then used to say ruefully:”We’ll never see 9% again.”
And yet, we now hear every day that the present 5 to 6% rate constitutes “soaring”.

A word to the wise: yes I see the ARM rate is presently about a percentage point lower than fixed long term, but please, do not take out an ARM. Do not bet on rates going down. Do not take on a monthly mortgage payment which may increase exponentially over the next few months or years. That way homelessness lies.

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I heard on local news in Delaware that ARMs are rising in popularity again.

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The only thing worse than being in debt is being in debt where somebody else controls the interest rate. This appears to be something people learn only by bankruptcy and is forgotten every generation.

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They are! I just can’t stand it. I mean ok, interest rates WILL go down again. What were they before this recent “soaring”, like, 2%? That’s waaaayndown from the 18% of 40 years ago. But in the short term they are almost certain to go UP first. People always seem to get into ARMs at the most inauspicious point in their trajectory. 6% fixed long term sounds pret-Ty good to this seasoned Ol’ campaigner.

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Yes. Make the calculation of what is the purchasing power of the dollars of the payback over the course of a 30 year amortization - in the “normal” 2% annual “normal” inflation. In case that makes you feel a little better, you can offset it by comparing the purchasing power of your Social Security tax payments to the purchasing power of what you get back in retirement (which money the feds can refuse to pay you if they wish and you have zero recourse!). Don’t forget that, as well, 85% of your SS income is taxable as ordinary income (the dollars you paid in were also taxed when you earned them AND those dollars (which you never saw) were included in your “adjusted gross income” were subject to your marginal tax rate. Not a much better deal than you could get from a loan shark.

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Yes Hamilton’s and Madison’s desire to levy taxes shining through brightly. Those two SOBs. I hope it is very warm where they are and no water front.

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