40-year note... - Posted by Matthew Chan

Posted by David Alexander on April 27, 2000 at 24:13:40:

Because people are conditioned to be able to pay off their house in 30 years and want the dream of owning there own home sooner not later. Not to mention your present value would go out the window. Why not just L/O the house out for a while and then sale.

I have seen some government loans at 40 years. And some government loans that were subsidized where if the people ever sell they pay recapture and might as have sold their soul and can never get out.

David Alexander

40-year note… - Posted by Matthew Chan

Posted by Matthew Chan on April 26, 2000 at 18:13:24:

If I create a 40-year mortgage note that has a good LTV (say 80%), would anyone buy it? Or is that just too radical?

Or how about a 30-year note with using a 40-year amortization schedule?

Am I being too creative because I haven’t heard it done anywhere. Or is it simply illegal following the guidelines of more conventioanl loans?

Any issues here I need to worry about besides the fact that principal paydown is near zero? :slight_smile:

Do a 300 year note with a 100 year balloon. - Posted by John Behle

Posted by John Behle on April 26, 2000 at 18:48:24:

Yes, you can create a 40 year note, but it won’t do a whole lot for reducing the payments or providing much advantage. It will reduce some of the interest of some buyers.

Ok, I will! - Posted by Matthew Chan

Posted by Matthew Chan on April 26, 2000 at 19:02:53:

Yes, it isn’t significant from a dollar standpoint. But depending on where the payment amount falls there might be a psychological difference between a $1276 payment vs. at $1316 payment which I was calculating.

BTW, why would it reduce the interest of some buyers? Risk is greater for being longer term?