Will student loan repayment resumption crash the housing market?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much? Lol it’s a lot of money, like 5 billion a month in payments!!!! It will have a major effect on the entire economy.

"The pause is gone within 60 days of this being signed," McCarthy told Fox News anchor Shannon Bream. "So that is another victory because that brings in $5 billion each month to the American public."

Except that Biden has changed the federal loan repayment formula through the Department of Education, effectively requiring only pennies on the dollar repayment with generous forgiveness terms.

Oh how I wish this were true. -person above who will be paying $1200/m on $90K a year from now.

I was paying about $630/month on balances of more than that. And that was years ago. Something wrong with your choices.

It’s based on salary so I must earn more than you did years ago.

No, my payments had nothing to do with salary.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much? Lol it’s a lot of money, like 5 billion a month in payments!!!! It will have a major effect on the entire economy.

"The pause is gone within 60 days of this being signed," McCarthy told Fox News anchor Shannon Bream. "So that is another victory because that brings in $5 billion each month to the American public."

Except that Biden has changed the federal loan repayment formula through the Department of Education, effectively requiring only pennies on the dollar repayment with generous forgiveness terms.

Oh how I wish this were true. -person above who will be paying $1200/m on $90K a year from now.

I was paying about $630/month on balances of more than that. And that was years ago. Something wrong with your choices.

It’s based on salary so I must earn more than you did years ago.

No, my payments had nothing to do with salary.

Oh then you are not in an income driven repayment plan. I am, bc I am doing PSLF.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much? Lol it’s a lot of money, like 5 billion a month in payments!!!! It will have a major effect on the entire economy.

"The pause is gone within 60 days of this being signed," McCarthy told Fox News anchor Shannon Bream. "So that is another victory because that brings in $5 billion each month to the American public."

Except that Biden has changed the federal loan repayment formula through the Department of Education, effectively requiring only pennies on the dollar repayment with generous forgiveness terms.

Oh how I wish this were true. -person above who will be paying $1200/m on $90K a year from now.

I was paying about $630/month on balances of more than that. And that was years ago. Something wrong with your choices.

It’s based on salary so I must earn more than you did years ago.

No, my payments had nothing to do with salary.

Oh then you are not in an income driven repayment plan. I am, bc I am doing PSLF.

So then what's the problem? You're working toward getting your loans paid off and you just got three years of payment free credit. You should be thrilled.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think the impact on home sale prices will be secondary or tertiary. I’m assuming the first things that get hit are restaurants, leisure travel (including AirBnBs, which due to regulation there aren’t a ton of in DC, so this will probably limit the spillover), and basic but labeled “luxury” apartment rents.

The issue with these things is how much spillover there is to other parts of the economy. E.g., corporations make less money, stock market goes down, layoffs accelerate, etc. Could be no impact or could be significant -- really impossible to say. But for anyone who believes that covid handouts created the economic mess we're in, it's extremely notable that this is the last handout to survive, and it is a massive one.

No, the last handout to survive is the 90%+ of homeowners who have fixed rate 30 year mortgages under 3.5%. That’s by FAR more impactful in causing and perpetuating inflation.

40 percent of primary homeowners have zero mortgage. Look at Avenil up the block from my in Potomac built in 1991 do you really think the 1991 buyers now older have mortgages?

The bigger issue is people with ballon or ARM. I work at a bank and we have some ARMs and Ballon mortgages on books will be an ugly reset. Not much but the few we have Ugg.

This is an incredibly low number of people because, see again, nearly everyone with a mortgage has a historically low rate and many of the people who paid them off were able to do so because of low rates. Again, THIS is a huge contributor to inflation, not student loan interest pause / forgiveness.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I owe $90K and have to start repaying $500 a month in August after that next April it goes to $1200/month. It is still worth it to hang on to get $59K forgiven through PSLF in 3 years but it’s making me effectively net level with any raise. I’m just finishing paying off two covid-induced debts when this one restarts. I am a perpetual renter and may never be a homeowner.

Join the club

Why did you take out $90k in the first place? And, why should I pay for your decision via inflation?

To get a graduate professional degree that quadrupled my earning power. And inflation is happening bc of the four trillion dollars the treasury added to the economy during COVID while holding interest rates too low for too long. You’re an idiot. Why should I pay for your absurdly low mortgage rate via inflation? That’s the real story.

You choose to rent. Own your choices. You could buy something somewhere.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think the impact on home sale prices will be secondary or tertiary. I’m assuming the first things that get hit are restaurants, leisure travel (including AirBnBs, which due to regulation there aren’t a ton of in DC, so this will probably limit the spillover), and basic but labeled “luxury” apartment rents.

The issue with these things is how much spillover there is to other parts of the economy. E.g., corporations make less money, stock market goes down, layoffs accelerate, etc. Could be no impact or could be significant -- really impossible to say. But for anyone who believes that covid handouts created the economic mess we're in, it's extremely notable that this is the last handout to survive, and it is a massive one.

No, the last handout to survive is the 90%+ of homeowners who have fixed rate 30 year mortgages under 3.5%. That’s by FAR more impactful in causing and perpetuating inflation.

40 percent of primary homeowners have zero mortgage. Look at Avenil up the block from my in Potomac built in 1991 do you really think the 1991 buyers now older have mortgages?

The bigger issue is people with ballon or ARM. I work at a bank and we have some ARMs and Ballon mortgages on books will be an ugly reset. Not much but the few we have Ugg.

This is an incredibly low number of people because, see again, nearly everyone with a mortgage has a historically low rate and many of the people who paid them off were able to do so because of low rates. Again, THIS is a huge contributor to inflation, not student loan interest pause / forgiveness.

Well, the good thing about inflation is it reduced the value of your student loans significantly. That's a help to the borrowers, even if most don't realize it.

[Anonymous]

Anonymous wrote:Sweet little OP has no idea how much people in this area make. We just bought a million dollar home, we paid off our loans years ago and have made a killing in the market.

A million dollar home is nothing special in this area.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much? Lol it’s a lot of money, like 5 billion a month in payments!!!! It will have a major effect on the entire economy.

"The pause is gone within 60 days of this being signed," McCarthy told Fox News anchor Shannon Bream. "So that is another victory because that brings in $5 billion each month to the American public."

Except that Biden has changed the federal loan repayment formula through the Department of Education, effectively requiring only pennies on the dollar repayment with generous forgiveness terms.

Oh how I wish this were true. -person above who will be paying $1200/m on $90K a year from now.

I was paying about $630/month on balances of more than that. And that was years ago. Something wrong with your choices.

It’s based on salary so I must earn more than you did years ago.

No, my payments had nothing to do with salary.

Oh then you are not in an income driven repayment plan. I am, bc I am doing PSLF.

So then what's the problem? You're working toward getting your loans paid off and you just got three years of payment free credit. You should be thrilled.

No, I didn’t because my FFELP loans were not eligible until the PSLF waiver when I found out I could consolidate them back into direct less than a year ago. So I paid and was charged interest all through the pause until October 2022. I have otherwise never missed a payment since 2005.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Sweet little OP has no idea how much people in this area make. We just bought a million dollar home, we paid off our loans years ago and have made a killing in the market.

A million dollar home is nothing special in this area.

Seriously ain’t she so cute with her $1M home.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I owe $90K and have to start repaying $500 a month in August after that next April it goes to $1200/month. It is still worth it to hang on to get $59K forgiven through PSLF in 3 years but it’s making me effectively net level with any raise. I’m just finishing paying off two covid-induced debts when this one restarts. I am a perpetual renter and may never be a homeowner.

Join the club

Why did you take out $90k in the first place? And, why should I pay for your decision via inflation?

To get a graduate professional degree that quadrupled my earning power. And inflation is happening bc of the four trillion dollars the treasury added to the economy during COVID while holding interest rates too low for too long. You’re an idiot. Why should I pay for your absurdly low mortgage rate via inflation? That’s the real story.

You choose to rent. Own your choices. You could buy something somewhere.

Ironic much? You’re the one who said the student loan pause was driving inflation. It’s not. It’s people like you with your charity/welfare level mortgage rate. I chose to rent bc I was, you know, paying off student loans.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think the impact on home sale prices will be secondary or tertiary. I’m assuming the first things that get hit are restaurants, leisure travel (including AirBnBs, which due to regulation there aren’t a ton of in DC, so this will probably limit the spillover), and basic but labeled “luxury” apartment rents.

The issue with these things is how much spillover there is to other parts of the economy. E.g., corporations make less money, stock market goes down, layoffs accelerate, etc. Could be no impact or could be significant -- really impossible to say. But for anyone who believes that covid handouts created the economic mess we're in, it's extremely notable that this is the last handout to survive, and it is a massive one.

No, the last handout to survive is the 90%+ of homeowners who have fixed rate 30 year mortgages under 3.5%. That’s by FAR more impactful in causing and perpetuating inflation.

40 percent of primary homeowners have zero mortgage. Look at Avenil up the block from my in Potomac built in 1991 do you really think the 1991 buyers now older have mortgages?

The bigger issue is people with ballon or ARM. I work at a bank and we have some ARMs and Ballon mortgages on books will be an ugly reset. Not much but the few we have Ugg.

This is an incredibly low number of people because, see again, nearly everyone with a mortgage has a historically low rate and many of the people who paid them off were able to do so because of low rates. Again, THIS is a huge contributor to inflation, not student loan interest pause / forgiveness.

Well, the good thing about inflation is it reduced the value of your student loans significantly. That's a help to the borrowers, even if most don't realize it.

I would have needed Mugabe inflation for a significant reduction in the value of my law school loans.

[Anonymous]

Yes, will have some level of negative impact on the economy. No, don't see it crashing the DC housing market.

[Anonymous]

[google]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Take a wild guess, where we are in this...

Ooh, you found a random graphic on reddit. You must now be an economist. Congrats on defending your dissertation.

Wasn't from Reddit, and I AM an economist.

No, I did not write a dissertation, nor did I need to.

The URL for your image disagrees with your disclaiming of reddit (as does a quick Google image search). And who gave you an econ PhD without a dissertation?