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Comment by crate_barre | Hacker News Reader

The same reason they loan out the money in the first place. Do they ever actually check if a young person will have the earning potential to pay back a 50k loan? Not really right, but they hand out that loan. I’ve gotten credit cards with 20k credit line 1 year out of college, no questions asked. That’s insane to hand that out and then blackball the receiving party. Liability is on both sides here but only one party suffers in an unbalanced way. For a large company, writing off 50k is nothing even at scale, but for the individual the scarlet letter is haunting.

Overall, I cannot fathom how we tied the credit system to something necessary like housing. It’s absurd to think you are fucked out of housing options for 7 years.

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1. Those credit card numbers are crazy and not something I've experienced in the UK.

2. Taking a huge loan out when you have little prospect of being able to pay it back is a persons own responsibility. I've been in debt, I know lots of people in debt, and in almost all cases it's due to my/their own poor decisions. This conversation changes if you live in the US and experience medical debt (not something we deal with in the UK).

3. Again, depends on your jurisdiction, but housing is typically available in some form (just not ownership) even to people with poor credit ratings.

i do not own a credit card. in our immediate family, taking loans is seen as a terrible thing. the result? i do not "own" a car because i can't afford it. same for going on expensive holidays or owing iphones. if i can't afford it with the cash i have, i am not getting it.

growing up, this has been my idea and i cannot imagine tying myself "in future" to an item of convenience or luxury if i can't already pay it in cash.

a large part of it comes from the reason that i am not a government employee who traditionally have enjoyed a "get employed and you will get your salary till you die", those people can certainly portion off their salary, future even because there is essentially 0 risk of being let off. OTOH, being a professional with no "assured" income, this is not possible.

i know people, like many who sport a credit card, own a vehicle for the lulz and the "experience" of making heads turn but i can't care less about neighbours idea of me owing or not owing an iphone or a top line car. meh

> if i can't afford it with the cash i have, i am not getting it.

With that attitude, about 99% of people couldn't ever afford a house because there is no way on saving the cash needed and paying rent at the same time.

But then the price of housing would drop until it became affordable to buy in that way.

I totally agree, here in Romania, prices have skyrocketed since the banks became involved... one might argue they fund new construction but the downside is it's destroying a lot of the authentic inner cities with "ugly" high rises...

Also somewhere there is a succinct explanation of how when you want a loan from a bank for a new property, they go to the central bank and get one to finance you, thereby creating money out of thin air, and adding to monetary inflation... but please correct me if I'm wrong

It would not simply because there are always greedy investors, airbnb profiteers and money launderers who will pay any price asked.

Unfortunately your approach is not very efficient when it comes to buying a house/apartment. If you are renting until you can afford to buy, you are essentially wasting your money. (Maybe you are lucky and have a place to live already, e.g. from your family, but that doesn't apply to everyone)

agreed. the idea behind that is i live in my family home that was built by my father and there is no reason for me to "move out". not me nor hopefully the next generation would need to build a new house so we wouldn't need to worry about that.

you are right about housing though. i agree. in my town, the property prices double in 4-5 years. In the 25 years we have built our home, land prices have gone up 68x and they are growing fast.

my argument was on credit cards and disposable income spending.

> If you are renting until you can afford to buy, you are essentially wasting your money.

Well, maybe.

Underwater mortgages are a thing.

> Not really right, but they hand out that loan.

Student loans, if that's what you're referring to, are basically 0-risk because they'll either get wiped out by the government at some point, or the person will eventually pay it off within their lifetime; this is helped by how you can't discharge student loan debt in bankruptcy.

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