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Abhijit Dey said:
> In 1980's prime rate was 20+ % ???
> <Imagines ARM mortgage rate>
> <faints>
And it wasn't just the absolute level that was horrific, but the rate of
change. In ~1980-81 I tried to buy my first house. My slick realtor
talked me into a house I could barely afford, and convinced me to work out
a move-in-and-rent-until-closing deal so the seller didn't sell to someone
else. Being an inexperienced kid I didn't know better.
Unfortunately this was just when the rates started to spike. From the
time we applied for the loan until it was finalized (as I recall you
couldn't lock rates on an FHA loan at that time), the loan rate went up
over TWO AND A HALF POINTS. I could barely afford it before that, and I
COULDN'T afford it after that runup. I ended up losing the house and
moving out.
People who have been getting 30yr loans at 5-7% lately have no idea how
good they've got it...
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