Dumb Things Realtors and Lenders Say #finance #financetips #financialfreedom

19 Jun 2023

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Short transcript excerpt criticizing a common industry saying that 'the interest rate on rent is 100%'. Speaker argues this is a misleading comparison because mortgage amortization front-loads interest early in the loan, so invoking '100% rent' to shame renters is a poor argument; there are better reasons to recommend buying over renting.

This is so dumb. And it really bugs me when people in our industry say this. They say that hey.
Rates aren't high when you consider the fact that the interest rate on rent is 100%.
Or they try and make fun of renters by saying.
Yo, awesome that you're paying 100% rent.
Have any of you guys looked at an amortization schedule on a standard mortgage? Look at the beginning of the mortgage term. Majority of the payment does go towards interest. So even if you're paying like a 6% mortgage, if you look at the beginning the first few years of that loan, you are pretty much paying 100% interest. So think about this fact before you say stuff like this, because it's not the best argument to make with consumers. They are are so many better arguments to make for stopping renting and buying a property. But this interest argument is dumb.