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Loans- Theortical Question

i heard they are doing 100 year mortgages in japan, places like tokyo where a tiny apartment is millions of yen
 
Originally posted by: Gnote
Is it possible to get a loan for say 150,000, spread out over 100 years?
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In the US? hahahahahaha yeah right.

I do NOT want my fathers debt i also do not want to leave my daughter with my debt.

I just ain't going to happen.

If it does Ford will be the first.
 
Why the fluck would you want to? :Q

Even at 1%, the interest would be killer... lol
 
Well actually, some Corporations issue 100 year bonds, which are similar to loans. But I don't think that is what you are wondering about.

The longest mortgage I have heard is a 40 year. Vic can confirm.
 
Originally posted by: Eli
Why the fluck would you want to? :Q

Even at 1%, the interest would be killer... lol
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Because, theortically one could general significantly more income from the use of the 150,000 than the cost of borrowing it over 100 years.
 
Originally posted by: CPA
Well actually, some Corporations issue 100 year bonds, which are similar to loans. But I don't think that is what you are wondering about.

The longest mortgage I have heard is a 40 year. Vic can confirm.
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Ahh, i see... details?
 
Ok so you want to give a new corporation a 100 year loan. Why? odds are the company is going to go out of business. so now what?

About the only way i see something like this happening is to a company like Sony. that odds are is going to be in business in 100 years.

its just silly to think about a 100 year old loan.
 
companies usually issue bonds or go public and issue stocks to raise money. i don't know any bank or institution that would give you a standard loan over the course of 100 years, its eems like a stupid idea to me as there are a lot of othe more creative ways to raise moeny for a growing company.
 
Originally posted by: Gnote
Originally posted by: Eli
Why the fluck would you want to? :Q

Even at 1%, the interest would be killer... lol
Click to expand...

Because, theortically one could general significantly more income from the use of the 150,000 than the cost of borrowing it over 100 years.
Click to expand...
So why not borrow it over 50 years then? Or 10? 😛
 
Originally posted by: CPA
The longest mortgage I have heard is a 40 year. Vic can confirm.
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Correct. And 40's are very rare, have higher interest rates and/or are interest-only/adjustable.

Simply put, longer term loans have more risk. In addition to getting a little profit off the interest, lenders are very concerned about just getting their money back period. Underwriters refer to this lenght-of-term risk as "risk exposure", or the longer the term, the longer the lender is exposed to the inherit risks in the loan. A loan longer than the average person's life would be almost certain to never repay.
Plus, much as some people might think otherwise, 99% of all lenders out there really aren't trying to enslave you into permanent debt. They're really hoping you'll pay it off someday. Just not tooo soon. And then refinance of course... 😉😛
 
Originally posted by: waggy
Ok so you want to give a new corporation a 100 year loan. Why? odds are the company is going to go out of business. so now what?

About the only way i see something like this happening is to a company like Sony. that odds are is going to be in business in 100 years.

its just silly to think about a 100 year old loan.
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Eh, case in point:

100 year loan of 300,000 at 5 percent interest results in a monthly payment of 1,258.57 dollars a month. Now the point of extending the loan out for such a large period of time is not to keep it till extinguishment, but to leverage the use of the money now to gain financial before the end of the loan.

Imagine buying a home for with that money for investment purpose and charging rent @ 1,000 dollars.

Since interest is front loaded your tax returns will hand you back a good 70- 80 percent of your monthly payments so effectively you're making 622 dollars a month from your invest.

Even if you end up selling the house 5 years in with no gain in the value off the house and pay off the loan, you've made 37K with money that you've borrowed on the cheap.

Either that or I've spent too long in the office this friday and I need to go home and rest.
 
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