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Strategies & Market Trends : The Financial Collapse of 2001 Unwinding -- Ignore unavailable to you. Want to Upgrade?

To: elmatador who wrote (6937)	12/3/2020 1:12:46 PM
From: Cogito Ergo Sum	Respond to of 13806

Two quick takeaways in my case.. credit grew savings.. via stock market and RE for example.. it is how credit is used that is problematic.. My for house in the gogo market of late 80s Toronto.. oh you can afford mortgage payments of 40% of pretax income .. YES PRETAX !!! No thank you I said.. I'm maxing out at 25% of income... .. I did.. bought a quality smaller property in Thornhill area 93K.. *Sold it in the BUST for 169K* 5 years later.. My amortization was already down to 13 years from official 25 years due to accelerated payment tricks.. All extra cash went to principle.. so I took out a good whack of CASH !! Bought a home detached on a big lot in then Scarborough now amalgamated SADLY into Toronto.. (Fcuking Con government under Harris... ) for 205K.. the previous owners had paid 315K in the boom ... Due to divorce we sold at 800K.. now? it's worth 1.1 Mil :( 3 years later.. WITH COVID !!!! folks are fleeing the DT core .. anywhere with net infrastructure (as I postulated :) DT Toronto home prices slowing GREATLY against the burbs.. and condo apartments ? DOWN... OTOH many speculated in time of my first home.. that was on credit and they lost their shirts... BAD uses of credit.. as in OVER LEVERAGED... greed and stupid are good for smarter folks :) That's why I got a DEAL on home #2 :) You need to look at how savings (if they are not working for you that is dumb) are used You need to look at how credit is used.. unwisely ie OVER leveraged with no accommodation for future possible changes.. is bad.. It is not so binary ... Bear in mind also .. we talk of rates rising a point or two LOL my first Mortgage was at 10.25 and rose to 12% before falling hard over the next few years.. I was locked in for 3 years as First Time buyer at 10.25 but then went semi annually :0) Credit and savings both need be administered wisely .. neither is a magic bullet.. but both can be awesome.. Interesting credit applications focus on ongoing ability to pay .. a steady job history is far better than a mattress full of money on the application :) pre 2008 they got away from the ability to pay model.. and what did we get :) That is corollary one to wise credit use...