40 years mortgages and no down payment- what do you think?

Discuss Canadian Mortgages here.
theway
Posts: 26
Joined: Tue Jun 03, 2008 6:33 pm

40 years mortgages and no down payment- what do you think?

Postby theway » Tue Jun 03, 2008 6:49 pm

I personally think that the only reason we haven't seen an outright crash in the Canadian property prices is the arrival of the "new and improved" mortgage products namely - mortgages with 40 year amortixation period and no-downpayment/5% downpayment mortgages. Most Canadian home owners blindly refuse to accept that we are in a HUGE HOUSING BUBBLE, but it will be fun to watch how housing gains evaporate quickly and Canadian properties start to tank in the next few months. I know that many homeowners won't like my opinion, but I can care less. I'm waiting for a properties to crash, and only after that I'll be a buyer.

gogysh
Posts: 8
Joined: Wed Jun 04, 2008 4:54 pm

Re: 40 years mortgages and no down payment- what do you think?

Postby gogysh » Wed Jun 04, 2008 5:00 pm

I think 40 year mortgages are a good option for people with less savings and lower income. I would take a 40 year mortgage but I have bad credit and I am not sure if I can get any loan at all.

FinancialAdmin
Site Admin
Posts: 9
Joined: Thu May 22, 2008 2:43 pm

Re: 40 years mortgages and no down payment- what do you think?

Postby FinancialAdmin » Wed Jun 04, 2008 6:24 pm

gogysh wrote:I think 40 year mortgages are a good option for people with less savings and lower income. I would take a 40 year mortgage but I have bad credit and I am not sure if I can get any loan at all.


No, the 40 year mortgages are not a good option for anybody. You will be paying much more interest if you get a 40 year mortgage and also you will be fueling the already high canadian real estate price inflation, which will only make the crash worse when it comes. If you cannot afford a house with 20% down and 25 years amortization then don't buy, it's that simple.

spencer
Posts: 37
Joined: Thu May 29, 2008 8:46 pm

Re: 40 years mortgages and no down payment- what do you think?

Postby spencer » Fri Jun 06, 2008 6:54 pm

The 40 year mortgages are scam designed to prop the property prices in Canada to artificially high levels (this already happened in case you don't know). The 40 years mortgages make the borrowers bank slaves for life, but wait isn't that exactly what the banks want?

sunshine
Posts: 23
Joined: Tue Jun 03, 2008 5:55 pm

Re: 40 years mortgages and no down payment- what do you think?

Postby sunshine » Fri Jun 06, 2008 8:22 pm

Do you have to be of a certain age to be approved for 40 year mortgage? If you are in your forties and get a 40 year mortgage is there a higher risk of defaulting on your loan?

spencer
Posts: 37
Joined: Thu May 29, 2008 8:46 pm

Re: 40 years mortgages and no down payment- what do you think?

Postby spencer » Sat Jun 07, 2008 6:41 pm

I don't know how a lender in their right mind will give somebody in their 40-ies a mortgage loan with 40 years of amortization. Are they going to be repaying the mortgage in their 80-ies? This will end really, really bad.

theway
Posts: 26
Joined: Tue Jun 03, 2008 6:33 pm

Re: 40 years mortgages and no down payment- what do you think?

Postby theway » Mon Jun 09, 2008 3:29 pm

I never thought about this, but you guys are right :). If I were a lender offering mortgage loans, I would never give a 40 year loan to anybody older than 30. I don't see how would they be able to service their debt in their retirement years.

businessinline1
Posts: 1
Joined: Mon Oct 06, 2008 8:18 am

Re: 40 years mortgages and no down payment- what do you think?

Postby businessinline1 » Mon Oct 06, 2008 8:28 am

if you get a 40 year mortgage and also you will be fueling the already high canadian real estate price inflation, which will only make the crash worse when it comes.


http://www.inlinebusiness.com

theway
Posts: 26
Joined: Tue Jun 03, 2008 6:33 pm

Re: 40 years mortgages and no down payment- what do you think?

Postby theway » Mon Oct 20, 2008 2:49 pm

businessinline1 wrote:if you get a 40 year mortgage and also you will be fueling the already high canadian real estate price inflation, which will only make the crash worse when it comes.


http://www.inlinebusiness.com


It looks like the crash in the Canadian real estate is picking up speed. I won't be surprised to see Toronto prices down 30% in December 2008 compared to December 2007. With all the speculators now scrambling to get rid of the depreciating properties there is a serious chance for this to happen.


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