it is impossible to buy a toaster that has a one-in-five chance of bursting into flames and burning down your house. But it is possible to refinance an existing home with a mortgage that has the same one-in-five chance of putting the family out on the street–and the mortgage won’t even carry a disclosure of that fact to the homeowner. Similarly, it’s impossible to change the price on a toaster once it has been purchased. But long after the papers have been signed, it is possible to triple the price of the credit used to finance the purchase of that appliance, even if the customer meets all the credit terms, in full and on time. Why are consumers safe when they purchase tangible consumer products with cash, but when they sign up for routine financial products like mortgages and credit cards they are left at the mercy of their creditors?
rest of this wonderful article at Elizabeth Warren’s page
Another article Some house truths on how government policies to control FDI in real estate is not helping the Aam Aadmi.
11 replies on “Interest rate Hikes”
basic truth of low interest rates hosing loans is that interest rate is not fixed!! Its a trade off with … and there are choices in the market which give fixed interest rate loans.
About the policies, most of the people don’t want the prices to come down as it is their investment and if the prices come down, they will have to face losses!!
In the credit world, If you don’t know the rules you pay up, thats how they earn!!
ya… thats what the article is all about…. why r the rules so complicate 🙁
so that they can make money!!! ever wondered why someone would give you credit line of 2-3 lacs when he is not making any money on it?
yups he is for making money.. and that is justified…. but what i do not like is the changes in the interest rates.. hidden charges.. and clandestine terms
This drives the last nail into the coffin. So guys instead of taking credit, start putting into your FD accounts and once the necessary capital is in, netotiate the best prize and buy it – you not only hedge all these risks of getting on street but also the most important issue – consumer goods depriciate regularly and by the time you are owner of that -its salable value is near 40% only.
@prakash…
save now and spend later is a good philosophy.. but tell me what good a Hawaiian vacation would do when I am old.. and lost my interest in adventure?
It will take me a lifetime to save enough to buy an apartment … and by the time I do that, I would be too old to climb the stairs.
Yes consumer goods loose value very fast… your car loses 25% the moment u sign its papers, your watch 50% the moment you peel off the plastic wrap… and the food/medicines 100% the moment you break the tamperproof seal…
but you still buy…. not because you want to invest in those articles.. but because you want to use/consume them 🙂
You are absolutely right Ankur. I have seen people saving money all their lives and in their old age lamenting that they didn’t enjoy their money while they could.
Nice post. Can call for a healthy discussion!
Aur kaisa chal raha hai? How’s work and everything? “Pegasus” ka kya hua? 🙂
@kokonad..
why don’t u share your views on the topic 🙂
life is going on great 🙂 and I thought of resume blogging in my own name
Ankur,
You dont need to save entire life time… consumer goods like TV, car all have short savings period of 3 years max!
Any way the choice is the users – the only option otherwise is to take credit and crib…nobody can help there.
Am yet to form an opinion. 🙂
(Read as: I am too dumb to understand all this finance mumbo-jumbo)