So now I understand why you don't want to get a mortgage to buy a house!
When Bianca spoke those words to me this week I was so happy.
It's like everything came together Crypto, debt, house.
One of the biggest things in life that I fear is debt.
I don't mean the kind where you lend 10 bucks from a friend to buy a round of beers. But the one that enslaves you for a while.
The mortgage.
I used to be like everyone else. Thinking a mortgage to be an honest way to buy a house.
This all changed when I learned how the money for the mortgage is created.
It's so simple that when I try to explain it to people they usually don't believe me.
It works like this:
The moment you sign the mortgage the money for that loan is created out of thin air by the bank. It never existed before, they didn't have it, it's not money from other depositors. It's new money created by the bank.
The loan is based on your ability to create value over a certain amount of time (aka work) in the real world.
But in case you fail to pay (let's say you get sick) the bank can still sell the house that you bought with the money they never had in the first place.
But in case you don't get sick and be a good lender they still have the audacity to charge interest over the loan (money) they created out of thin air.
You what now? yes, I know. It just doesn't sit right with me.
It's an honest way for the debtor but not for the lender is it?
Cryptocurrencies can't be created like this. That's why I like them so much. It's freedom.
I talk about it more in my vlog.
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I thought it was all over when we had some green yesterday but the downtrend is back again. One huge benefit I have had is that I've been able to scoop up some EOS at $0.80. I thought it would never drop below $1.50 but I guess if you are patient enough opportunities will arise.
I don't think I'll ever be able to buy a house in my life and I really don't want to get a mortgage. When you do get a mortgage it is true, someone hasn't really bought the house and it is on loan. I think with something as big as a mortgage comes huge financial pressures and it isn't a risk I'm willing to take.
Houses cost way too much in the UK so I'll probably be hopping around rented properties from the rest of my life which may cause some financial issues later on in my life but I won't have to fork hundreds of thousands of pounds (which I don't have) and give it to the banks.
Banks just creates it purely out of thin air and this system based on debt benefits no one expects for the banks and that is why they are so inclined to holding on to it rather than moving to something more distributed and equal such as bitcoin.
All this does is hurt us normal citizens as everything gets inflated in price and the value of fiat depreciates. It disgusts me how everything is based off debt and interest which really is unfair and we are like cattle being farmed.
At least people are waking up and realising how this is a terribly unjust system and we can start using crypto in the future where money is not created from a few numbers being generated. I think people are naive or are just purely trying to scaremonger when people say ' crypto is leading to all this criminal activity ' when regimes are being funded with USD.
Let's see if we will see this revolution in our lifetime but they may not be the case @exyle
This is one of the reasons why I joined Steemit. It provided me with a good intro about cryptos, blockchain... And this has allowed me to buy other cryptos like ETH.
While the bank is taking its share for my loan, I am planning to repay them before time to not lose to interest.
But the sacrifice required is getting bigger day by day with that beast called inflation
I love how steemit is acting as a stepping stone for people into the cryptoworld
Inflation is constantly going to consume the world as we keep printing money and creating it out of thin air giving this false valuations
You know, it isn't such a bad thing to rent for your whole life. Even if we "own" homes, we don't take them with us when we die, so is it that different from a rental that you can comfortably inhabit?
Of course, you can't pass on a rental to your kids... but you can pass on all that saved money, and they can buy or rent as they'd like. I'm with you, and @exyle, and everybody else in the thread espousing this idea - NO WAY, NO MORTGAGE!
bitter truth we dont take them with us when we die *
Ethereum coins are created also out of pure air. Pay attention. Ethereum is very similar to current paper nation currencies.
BITCOIN is debt free
Great video, my bro! And highlights the dangers of getting involved in the dreaded "mortgage". I can think of two of my friends off the top of my head who are already up to their necks in debt. And you know what? They are absolutely happy with it and readily accept it for what it is. Very dangerous territory if you ask me.
I say that because from the moment you sign that piece of paper tying you up financially for X amount of years, nothing would make them happier than for you to default on that agreement. They would suddenly get a huge cash injection from that customers plight, rinse them dry and repeat the whole cycle once more to another pair of unsuspecting victims.
After all, they were the main instigators of the great economic downturn of 2007-2008. Doling out mortgages like there's no tomorrow, except the problem was the people back then declared themselves bankrupt instead. Now the checks are much more thorough so that if the same things happens now, you can bet they will recoup all the money back. And then some!
Well thought out and awesome vlog, yet again, bro! :)
I'm 29 years old and the idea of buying a house doesn't frighten me because it will be near impossible for me to ever buy a house despite having a middle class job. Im a structural engineer and make okay pay but based on other people's pay scale and with current home prices, starting a family with a wife and a single kid would require me to nearly double my pay just to be able to save enough to put a down payment on a house.
That says a lot about the job market (somehow employment is at 4.7% in the US and we cant seem to save anything).
So what do you do? I'm not sure to be honest... I ended up investing in crypto and stocks. What do you guys do with your money?
I ended up doing the same. But I no longer have stocks, only crypto.
Are you trading crypto with a long-term outlook, or is it purely trading for profit and moving into and out of positions?
I have done day trading and swing trading for profit, but it requires a lot of time and commitment, of which I don't really have given the nature of my day job. Most of money goes to crypto because I don't see saving it as useful right now.
In order to accumulate enough to buy a house, I'd have to work almost 15 years to be able to afford something in NYC. But investing in crypto, like any asset class is much risker than anything else.
Alternatively I could find a new job that pays more!
Long-term outlook. I buy and hold. I used to trade but it's like you said takes a lot of time and buy and hold has proven way more profitable for me.
I definitely agree that incurring debt is a bad way to go. The process you just mentioned is one way money is created out of nowhere. It's called the fractional reserve system and it's a method of leveraging and multiplying money within the banking system.
I am fortunate to live in an area where home prices are still "reasonable", let's say. But yes the inflation in the economy has occured in assets like homes, so basically the baby boomers in the end obtained a large appreciation in their investment, but now with stagnant wages the next gen has nowhere to live. add this to nearly double digit yearly increase in education and healthcare many years and it means many family generations need to live together.
We have a long way to go about informing.
Steemit and @exyle at its best.
It is frightening how the mortgage system works.
Keep on steemit!
Yes, the economy nowadays is a game where the biggest players set the rules themselves. It is really bullshit if you understand how it works and we already get ripped off by this scam for decennia. Now with decentralized systems like Bitcoin we can create our own fair game where the rules are set by free market forces. Join the revolution, educate yourself and get involved in cryptocurrencies! Stop playing their evil game!
Educating oneself is so important indeed!
well i think you are right the most obvious disadvantage of mortgage is that you are carrying an enormous debt over a long time. The other major drawback is that since the mortgage is secured on your property, you have to be able to keep up with your mortgage repayments or you could lose your home.
During the credit crunch, lenders worked hard at keeping even those struggling with the mortgage in their home. But if homeowners really can’t make the repayments, their home will be repossessed. The bank or building society will then sell it to recover their money.
Although the monthly amount you’re paying may seem reasonable, the total amount you pay back over the years is huge. For example, someone who borrowed $160,000 over a 25-year term would repay $280,600 in total once interest is added on! (This assumes the rate of interest averages 5% over the term.)
Good morning @exyle
Thanks for today's insight and real world examples as to why crypto is the place to be long term. I never wished to buy a house, and pay almost double for it, giving the mortgage company (bank) something like 75% of the total value in interest. The system is a joke.
Crypto is the new ladder to replace property i hope!
Have a good afternoon
Asher
p.s. bought 265 Steem this morning at around $1.06 :)
Congrats on your buy!
Looks like i caught the dip quite well! Still possibilities of further lows but i suspect many would like to collect some Steem under a dollar so we shall see :)
Banks have enslaved people for a long time. The evils of central banks do the same with banks either by enabling then or restricting them. After mortgages are created, they are bundled with other mortgages and sold as an asset to investors. The banks create an asset out of nothing and sell it? Total fraud!
You are wise not to play the game! If projections hold true, in a few years you will be able to buy a house with a bitcoin or two.
I'm banking on crypto indeed :)
Excellent post.Mortgage leads to years of financial slavery that might end in the tragic loss of foreclosure. Take an example of what happened in the US after the 2008 economic crisis. So many people lost their houses after years and years of making payments to greedy banks. Am sure most will never recover or will take many many years. Great caution should be exercised with debt. I hope cryptos will set most of us free from the debt/mortgage deluge
Hi friend, yes I am completely agree with you about the loan process of the bank. If we take loan from bank, the bank create new money call credit money .The bank then lend them to the customer as loan and charge interest. Ones if anyone fails to repay the loan the bank may chiled your property. So I think loan money is not good as far as possible. Have a great day friend happy steeming.
Haha..such a simple way to explain it. It is indeed really difficult to be living in debt forever to buy a house. Specially in Kathmandu where the hosing prices are almost at par with most States in the US and the interest rate is around 10-12% and other banking charges are atrocious as well. I realised I could be living a more than happy life on rent just with the interest money. If I have to borrow $50,000, I might as well take it all in cash upfront so that I can use it in something productive. Rent is the best option for now.
I understand what you are saying, but you have to live somewhere, and then you have two options, to rent a house or to buy a house. Because the interest is so low, it's cheaper to buy a house than to rent a house. Besides, in the Netherland's you can deduct the interest from your income before tax, so you pay about half or 40% of the interest yourself. So that's why many people still buy a house I think!
Agghh responsibility, and being tied down doesn't appeal!
House prices went up hugely in the 2000s. For graduates around that time, like myself, the prices looked ridiculous in the UK - although not as bad as they do now. It's nice to have a deposit, something which not many of the younger generations have, unless supported by family (who have 1/2/3 properties which have since quadrupled in value!).
fantastic post @exyle, i totally agree with your words, mortgage is not a good thing to buy products or houses, by getting mortgage we almost becoming slave of banks, and the most cruel thing is that we have to pay interest and with the passage of time that thing makes a person sick and he also gains lot of stress with this huge repayment and his normal life also get disturbed and just can't able to enjoy his life with freedom because all the time his mind is thinking about the repayments and if one month he can't pay then in the next month he also have to pay the late fees.
so in my opinion the one who takes a mortgage for a business purpose that's some what except able that he take the mortgage and invest it in business and then he work hard earn good profit and then repay from that profit in this way i think mortgage is only acceptable, in other way if you take mortgage and buy a house then that's mortgage makes you sick and slave, so to buy the house most safest way is do savings and once you have enough cash then buy it.
Banker debt is the worst, they love to legally steal your collateral at any chance. Besides, everything is in a bubble right now. If you want to buy anything, House, Car etc. Wait 6 months to a year, after the crash everything will be allot cheaper if you have gold & silver or Crypto, you can buy all the things you want at that time for near nothing. If you want to buy something now, buy Silver Bullion. You be a Winner...
I hate a mortgage because of the same reason. Nevertheless, it is the only way to buy a house. Except if you have saved a huge amount of money to pay the house in cash. Until then it is just impossible to buy a house without a mortgage.
That's the main problem, which is why I had to go for a mortgage and would do it again. Buying a house and slowly paying off the mortgage, so it becomes my own house... It's just smarter to me than renting a house and ending up with nothing in the end. Now if I am ever forced to sell my house, I'll atleast get some extra money (I'm not 'onder water'). If I'd be forced to leave a rental, I'd have no home and no savings.
Exactly the reason why I too have a mortgaged property; I don't have the large sums of cash to go out and purchase a house outright. A little bit here every month gets you closer and closer. The other main reason that a mortgage is a more preferred route is as you state - if you ever have to sell your house, the chances are that you will have made money on the property rather than the next-to-zero interest rate that banks are currently charging. Of course, that does depend upon your initial mortgage and geographical location.
I guess it's old fashioned but nevertheless it is at least better to buy a home with mortgage than to rent one. Without savings there just isn't any other way.
Yes, my friend, take a mortgage, this is part of the iceberg, the most insidious part is under water. I also have acquaintances who have taken a mortgage and frankly speaking, 20 years will live like a barrel of gunpowder, especially in our time of crisis! Thanks, for this topic @exyle
Our monetary system is so simple yet so unbelievable. People take it for granted while this system, together with the way our capatilistic system is designed, causes for a whole lot of trouble (to say the least).
It's a bloody tough one. I have one, I resent it but the state of renting in Britain is a terrifying, expensive and insecure thing. What I hope is that I can pay it earlier than expected and suck one to the backs for all their extra interest.
Crypto will help you get there, man!
That's my hope!! :0D
Well not entirely, in the crypto space mortgages can be similar to ICOs, money made out of thin air. Also upvoting on steemit is also similar to creating moeny out of thin air, something you had mentioned in a previous post of yours.
Not entirely true. The money that is used to buy into ICO's was money that already existed. It was not created out of thin air.
Upvoting on Steemit is telling the Blockchain who should get what according to your stake. But the work has to be done first.
I always thought that mortgage debt was ok, and that only credit card debt was bad.
Now I have heaps and heaps of both type, I realise I was wrong and it's all bad.
Maybe one day I won't be a debt Slave. But sadly not today :(
Interesting post. Definitely also watch this video "Where does money come from? Waar komt geld vandaan? Var kommer pengarna ifrån?"
https://www.youtube.com/watch?time_continue=100&v=b6_SLwReMqo
good video indeed!
Here in Brazil we already have houses being bought with Bitcoin. This is perfect, we do not have the bank in the middle and everyone leaves happy.
That sounds great!
I have bought everything in my life outright, one payment. I'm over forty years of age and getting ready to buy this house outright in a few years, God willing. The FRB is not going to generate slavery out of my work.
Am also having such a debt on me..
Ever since I took that loan, my life has changed drastically.
Even before getting my salary, I need to see the bank take a good chunk out of it.
Problem is that in my country I do not have much option except from taking the loan else no progress :(
I sincerely believe that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.
I have similar feelings about debts. It's not so much about fear , it's more about freedom to fell free without any pressure. That's why i never took any credit in my life.
I think that there's a problem on how the current currency system works, not political or ideological, but mathematical - the debt created can never be paid back 100%. The current paper currency is DESIGNED to have debt, and it cannot be different - debt free.
BITCOIN works with different logic - there's a maximum coin supply. BITCOIN can be a real meter of value over time forever - no risk of manipulation of markets by creation of new money by bad politics or bad calculus. BITCOIN is debt free by design.
But there are some condition for all this to work, despite the positivity we have to pay attention to many elements still - security and maximum supply persistence... If will happen that BITCOIN maximum supply got changed by some group of programmers... the meter of measure will be corrupted forever- like it happens with the traditional currencies.
thank you for reading.
I look forward to see you on my blog in October.
I am also one of the people who is very afraid to owe this moment. One of the problem is when we can not afford to pay. But sometimes if the amount is small, we can just forget it and it will bind us forever, even to death though. Debt is still debt, there should be no term forget, whenever still be paid.
Many people looking for solutions how to get out of debt, I think steemit is one of the solutions that exist today. Struggling to write for inbalan by building a good community, with hard work I am sure all can succeed here. will not talk about Cryptocurrencies, because my knowledge of it is still very minimal. But I believe with steemit alone you can keep away from your debts.
This article has really opened my eyes to the dangers of debt, i wish alot of people would read this article
So the cryptocurrencies will change the future of economy a lot and we will be having a stable and cashless economy.
@exyle You're absolutely right. The system is completely rigged to enslave people who aren't enlightened to it. The banksters own everything, even your house AFTER it's paid off: they own the governments and who comes and takes your house if you don't pay property taxes? Crypto may be the only hope.
I'm also hoping crypto will set many free.
debt is an inevitibility of life, especially when it comes to buying property, the trick is to try and moves your mortgage round every so often to chase better deals and to try and pay it off as soon as you can even is you have to take a second job, dont let the buggers make more in interests off you than you can avoid
Everybody fear debts - once in never out.
It's worse than joining mafia.
Your great writing and nice video. it is interesting post .thanks @exyle
have anice day
It's trendy to say " I feel ya " . Consider it said from my deepest places .
Thanks for sharing!
Some interesting information here.
Interesting information and useful .100% like and resteem
upvoted nice post my friend..
ye i love part about crypto that we know exactly how many of them are there and nobody cant create more from air of them;) limited edition rox
Interesting post
True :) And very good post :)
Wow, the system seems more creepy than I ever knew. Thanks for sharing.
Don't doubt to fear! Be afraid, separate yoursel from the fear then and then realise that it's just a ilusion/product of mind.
Enjoy life!
Enjoy @nature.art
Have you ever looked at the origin of the word 'mortgage'?
When you do it's easy to see why you'd never want to get one!
mortgage (n.)
from Old French morgage (13c.), mort gaige, literally "dead pledge" (replaced in modern French by hypothèque), from mort "dead" (see mortal (adj.)) + gage "pledge" (see wage (n.)).
http://www.etymonline.com/index.php?term=mortgage
@exyle,
You are absolutely correct my dear friend! If someone ask me why I am still rent a house as you do, I will definitely show this post! Respect the way you think!
Cheers~
People have been brainwashed into thinking that having a house and a large mortgage is a great investment. The Latin translation of mortgage is literally "death pledge" or debt until you die. Not a great concept. You have seen the light! Congratulatons. You are a smart man.