10-14-26 amateur
| Another problem may be that the fund managers may not have the legal authority to engage in these negotiations. |
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10-14-26 amateur
The frozen mortgages are consequence of the repackaging and circulation of loans. Mortgage is an accessory, the loan is the principal.
In the old times, the bank could accept from a 3% debtor a discounted payment equal to the present value of the contractual payments of the loan. Discounted at 6% the original debtor would get a huge discount, the mortgage would be cancelled and the bank would have his money back to place a new loan at 7%. Everybody happier in a Pareto way.
Now the owner of the loan is a mechanically managed fund with no capacity to refine these deals.
This might be an interesting area for AI… |
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10-13-26 carib
| Savo: just go to the Revolut website and see how to get interest. |
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10-13-26 savo
carib.. i ve never seen any interest paid on my revolut account....
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10-13-26 carib
By the way: right now, Revolut, which is the leading international new debit card, pays you interest on your balance, on a daily basis, and you can still access it for payments without problems. 2,25% on €.
not very high, but way better than 0%.
Banks need much more competitive pressure from fintech, IMHO. |
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10-13-26 carib
| SPAL: concerning interest on deposits.. I very well remember getting that without any problem 30-40 years ago, obviously in Europe. There was no distinction between "saving account" and "checking account". Money markets paid interest on tomnext, 48h, 1 week or 1 month. Banks just took ordinarily 48 hours to cash your check, and you negotiated the interest on the current account with the bank manager, based on average balance. |
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10-13-26 carib
SPAL: "not going to fly", indeed.. like most reasonable innovative solutions without backing from strong vested interests.
In my case, the only mortgage I ever took.. has now been fully repaid, so the issue is entirely academic. The multi-million project financing multi year loans taken at low rates.. also now fully repaid. Not planning any borrowing at high rates.
I just wish I had taken more long term debt at fixed rates.. when the base rate was 0%. |
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10-13-26 spal
If in $20T they include cash from corporate, then the financial officer is an idiot that doesn't produce a 3.5%+
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The corporate accounts mentioned are essentially corporate checking accounts - they are expected to have "float" in them - and the value is that the funds can be instantly "transacted". No one will also pay you interest on something like that (the ability to instantly transact). |
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10-13-26 spal
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10-13-26 spal
I am talking about a potential innovation, not existing laws.
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Based around a mortgage concept or some radical floating charge ... not going to fly ... IMO ... but that sound not stop people thinking about it.
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10-13-26 carib
| Leo:clearly, without bondholders consent, there will be no restructuring, but protracted default. But we have no visibility on timing and structure. |
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10-13-26 leopardo
Carib 40% is a blocking minority, they will have to listen to the creditors group imho.
Cannot make a deal without them. |
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10-13-26 carib
Savo: IMHO there is no difference between 37% and 40%, but having insider info is always a plus.
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10-13-26 carib
Dalio on 2027
https://www.linkedin.com/pulse/numbers-behind-bond-bear-market-look-equities-ray-dalio-he3jc/ |
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10-13-26 savo
why is that 37% thing important?
They will screw us royally with any %! |
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10-13-26 carib
By the way.
the Venezuela creditors committee apparently now represents 37% of outstanding bonds, and seeks to get up to 40%. Should colores try to get a (small) seat at that table? |
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10-13-26 carib
Using data from realtimeinequality.org, the share of the top 1 percent — roughly corresponding to Zidar and Zwick’s definition of the wealthy — in U.S. wealth rose from 23.2 percent of total wealth in 1979 to 38.3 percent today. So one might think that the great rise in concentrated wealth was a “1 percent” phenomenon. But if we look at the changes in wealth share within the 1 percent, we find that very little of it involved the bottom 90 percent of that group, and most of it came from the top 0.01 percent — the one percent of the one percent.
Colores, IMHO, are 1%ers, but not 0.01%ers. |
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10-13-26 carib
In its World Economic Outlook, the IMF predicted on Tuesday that net borrowing by advanced economies would reach 5.2 per cent of GDP this year, the highest since 2021, when the world was in the grip of pandemic lockdowns.
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10-13-26 carib
The government is a body resulting from elections. People tend to vote with their wallets, if not brain amputees.If a majority of voters have property, they will vote for governments that do not harm the value of their assets.
Your argument about Madrid and Avila is obviously correct.
Same happens in Portugal.. where there is an EXCESS of real estate available country-wide, but a shortage in the locations where people actually want to live. The main known remedy is building more vertically.
We live in a world with government and central banks, not in an utopian capitalist paradise. |
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10-13-26 panasonic
Carib, portable mortgages could be done but it will take time, next year something will give up and rates will start to drop.
Imho labor market will cool down, maybe not that much on quantity but certainly on quality of jobs.
Onlyfans 'creators" will be ok:-)) |
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10-13-26 savo
carib.. owners want RE prices to go up... new buyers and future buyers want them to go down... who is the government to pick winners and losers?
In market capitalism the market will be setting interest rates not the central bank... and that rate will perfectly well clear an equilibrium between saving and investment...IN THE DIFFERENT REGIONS.
As I mentioned before... interest rates do not exist because Central banks exists. They exist because time exists and some people choose to consume now and some in the future.
Real Estate is not a unique market... Madrid is not the same as Avila... a lot of people want to live in Madrid because there are plenty of jobs in Madrid... few people want to live in Avila because there are very few jobs there.
Consequently there is excess demand of real estate in Madrid... and excess supply in Avila... prices go down in Avila and up in Madrid...
That is the way things would work normally
the problem comes when Central banks decide to artificially lower rates... creating real estate booms... that is where the US is right now... so unfortunately they will have to swallow the bitter pill of housing price deflation or c
choose inflation... continue kicking the can... and hope it explodes in the hands of the next administration.
There is not choice it is one or the other.
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10-13-26 panasonic
Bonjour colores, abt. $20T question, we would need to dig bit more, US households on average have very low liquidity.
If in $20T they include cash from corporate, then the financial officer is an idiot that doesn't produce a 3.5%+
My accounts have automatic swap with Gov. money market funds @3.7% calculated on daily basis paid at end of month. |
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10-13-26 carib
| Savo: precisely.. I do not want to see RE prices tank, because that would create an array of new problems. It is not just "politicians": if the majority of voters own real estate, the majority does not want to see lower RE prices, in reality. |
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10-13-26 carib
SPAL: that is obvious.The mortgage is secured by an asset. to be moved, the security must be replaced by an equivalent or better asset.I am talking about a potential innovation, not existing laws.
And I am not talking about purely commercial arm length contracts, but about mortgages that involve some government direct or indirect support.
The issue I see, is that 30Y mortgages in practice do not have an average duration of the full 30Y, because many people change house during their adult life, so the lender can back it for the expected average duration, rather than the full 30Y.
If you make them "portable", they will tend to last the full 30Y. But this is likely to happen anyway, if the fixed mortgage becomes too good to let go.
If there is a big crisis and rates fall again, the problem will solve itself, IMHO.Otherwise it will grow in size. |
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10-13-26 victor
| el de la eurozona, que pasa del 0,9% al 1,1% |
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10-13-26 victor
| El Fondo Monetario Internacional (FMI) eleva de forma significativa su previsión de crecimiento para España en el 2026, del 2,1% al 2,5%. |
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10-13-26 spal
The term "portable mortgage" is a marketing shorthand for a contractual rate-transfer option,
So good luck finding this anywhere in rising rate environments. |
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10-13-26 spal
When commercial banks in certain jurisdictions (such as the UK or Canada) advertise a "portable mortgage," it is not the underlying legal security instrument that moves.
Instead, it is a contractual feature within the credit agreement where the lender promises:
"If you pay off Loan A upon selling Property A, we will execute a completely new Mortgage B on Property B and grant you an interest rate blend/discount that mirrors the rate terms of Loan A."
It requires a full legal closing: title search, appraisal, new mortgage deed execution, and registration of a brand-new lien against Property B.
The term "portable mortgage" is a marketing shorthand for a contractual rate-transfer option, not a legal property of the mortgage security itself. Because a mortgage is an in rem encumbrance on a specific title, the original lien must always be extinguished upon sale, requiring an entirely new security instrument to be drawn up for any replacement property. |
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10-13-26 spal
| Savo - on portability you are correct on the economic effects. Concerning the idea itself it is essentially a non-starter due to the fact that mortgage security interests are registered directly against a specific real estate title deed (in rem). Substitution of collateral is a very rare legal process. Upon sale of the physical property, the underlying lien must be satisfied and extinguished. The loan cannot simply "follow" the borrower without executing a new security instrument on a new asset. The concept of "portability" is not easily applicable to the mortgage concept itself. It is not a characteristic of the arrangement. |
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