I'm at 1.1% and almost done with it anyway.....I feel sorry for people who are just getting into the market now.

 

I have a 2.75% 30 year fixed. It was refinanced from 3.77% Just opened a $200K HELOC @ 4.35 percent, it's for emergencies

 

You misunderstand me. I said under your scenario inflation is stopped but the economy is badly damaged. I understand that inflation has not stopped lol

LOL, why? Rates are still extremely low. My first mortgage was 7% and THAT was historically low. You're not at 1.1% on a fixed rate mortgage.

 

to the average person, inflation has EASILY risen 20% in the past year. you obviously have enough disposable income that it doesn't matter (your 'big' bills, leases, loans, probably haven't changed a lot).
but to those who go to the grocery store, they've seen meat prices double or triple. eating out has doubled. produce is going up. packaged good are now coming in smaller packages for the same price, which probably means 20% increases also.
obviously cars have skyrocketed. then gas. homes. rents...

the government LIES ALWAYS about inflation. did you know the CPI doesn't include energy or food? talk about crooked.

most if not all HELOCs have variable rates, so if market interest rates go up, so will your HELOC rate. of course if you haven't borrowed against it, it doesn't matter.

 

Mine was 8 percent in 2006. I refinanced a six months later down to 6 percent. Than the whole fricken market collapsed not that long after that, and 1/4 of my neighbors were walking away from their homes, thankfully I held on

 

Nope, it's for emergencies. Yes, does have a variable rate

 

Yeah I am, magical thing called a large family that has enough internal capital so I don't have to use an external bank. Sorry if yours is so high, I feel sorry for them since prices are so high relative to earnings vs even 5 years ago. They can't buy the same tier of house anymore

 

I've had a GS400 and GX460. I would do another UZ V8 if I'm doing one to keep.

 

I don't disagree with any of this, but that doesn't mean that the Fed is going to raise interest rates to 20%. Thats not going to happen. Thats what Jill is talking about.

As for arguing about the CPI, thats again a political issue and there are two sides to it.

There are actually a good many fixed rate HELOCs out there today.

 

Well thats a completely different thing, you can't compare the terms that family members give you to what is commercially available to a homebuyer from a mortgage lender.

My mortgage isn't high, its 3%. As for people not being able to afford the same tier house as they did 5 years ago, thats not the case because of the low rates. That is just now beginning to happen as rates go up. The vast, vast majority of people don't have wealthy families to basically give them free money and they borrow from lenders, and 5% seems high because we have had low rates for so long, but it isn't high historically. We sold houses at 10%, 15% 18% rates, when rates rise people go to ARMs and things like that, and we're already seeing some people do that. It will all be fine.

 

and whats going to happen instead is a currency devaluation and rocketing prices

 

Yep, that describes inflation.

 

Your rate is very good as I kinda expected if you honestly, I assume your 7% rate was a few houses ago?

I'm well aware 5% is not bad and only seems high in recent context but people have become used to that context. Now if you want a house that people are asking 650k-750k like mine goes for now a rate hike from 3-5% to 7-10% makes that super expensive vs when the exact same house minus exterior repaint 5 years ago was 375k. In my case we have a fund controlled by the family head who does risk assessment etc and sets rates from the common fund, I'm lucky since I'm directly in the line of succession so I'm well trusted. However the faster I can get the money back into the fund the more everyone has as a whole so I've been doing not much else other than that for the last few years.

I really hope it does go fine since my friends are angry since 1/2 of them are vets and doctors and they are complaining about loan rates and massive principles combined with the housing market. They don't want to max out their monthly paychecks just to have a house but it's increasingly looking like they will have to. The guys who have "normal" jobs have somewhat given up and consigned themselves to renting

 

Inflation will continue as raw material prices as skyrocketing.

 

Like I said, that was my first mortgage...in 2007. That was a good rate then.

There's a big jump from where we are to 7-10%, I don't think we will see mortgage rates north of 7% anytime soon. It has a huge impact on affordability, but remember that wages are also up and the economy on the whole is doing quite well. Values are also not static and if you saw 10% mortgage rates, values would come down. Remember that the Fed Funds rate and mortgage interests rates correlate but there is not a direct causality between them.

It will be fine, it always is. There are adjustements here and there, pain a times and growth at times but in the end everything will hash out and be fine.