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Comment by clairity | Hacker News Reader

from a purely capitalistic perspective, i can understand that providing financing of this sort could be of some economic value, but i worry that it simply continues to exacerbate wealth disparity by funneling more money to already wealthy financial institutions under the guise of helping teachers and children.

rather than this type of roundabout financing, the economics can be straightforward: school districts in wealthy areas should just pay their teachers more. and it sounds like they are, at least in some districts, according to co-founder jra6 elsewhere on this page: "...educators in Mountain View are paid reasonably well ($80,000 - $130,000)...".

even so, the idea that teacher homeownership is the central problem for schools is quite a stretch. poverty and a dozen similar issues are much more likely the central problems for schools, not teacher homeownership.

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I don't disagree -- I definitely struggle with this. The problem we are solving shouldn't exist. We should live in an society where people with equal incomes should have equal access to credit.

The reality is though that intergenerational wealth transfer are the primary way people acquire the necessary equity to buy homes (they get help from Mom and Dad). So I think you need both... both higher incomes, and mechanisms that create intermediary stages being renting and owning.

And on being a stretch, don't disagree. I feel the incentive is to be provocative beyond reasonableness, so apologize for that! Public schools in America are suffering death from a thousand cuts. I will tell you though that when urban school turnover (largely as a result of rising housing costs) is now up to 25%/year... it becomes your primary issue pretty fast.

Are intergenerational wealth transfers the primary means to down payments across the Bay Area or the US? The latter doesn't comport with my friends experience, but I'm always easily persuaded by hard data. Any references?

The hard data is piss poor. It's largely self-reported data collected by media agencies. Just google "Bank of Mom and Dad", there are lots of poorly done studies. This one is okay: http://paa2005.princeton.edu/papers/51443

The reason it's poor is because everyone has an incentive (bank, broker, parents, you) to under-report the parental funds. Parents send the gift money in advance (3 months to be exact), banks look the other way to meet equity requirements and the transaction takes place.

"Don't disagree -- I definitely struggle with this. The problem we are solving shouldn't exist."

totally understand that you can't solve the world's problems on day 1, but hopefully you're thinking of ways to address this bigger macroeconomic issue along the way, since you are already positioning your company on the social good axis.

"We should live in an society where people with equal incomes should have equal access to credit."

is there really a disparity among equal income earners for credit? credit getting unreasonably expensive as you move down the income scale (predatory loans and the like) seems to be the main problem you hear about in the news.

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