5 ms·

It's really not. If you buy a house with a mortgage, and later sell the house before the note is due, you will not owe the full amount of the accrued interest.

It's really not. If you buy a house with a mortgage, and later sell the house before the note is due, you will not owe the full amount of the accrued interest. Unfortunately the resale value of a secondhand war is very low.

OJFord 5y ago
Of course you do, you're just typically rolling it into another mortgage on the next place. Anyway I didn't say and didn't mean it's the only valid interpretation of 'spent', just that it is one.
- thaumasiotes 5y ago
  No, you don't. You might in a state of nature, but the US has laws against prepayment penalties for mortgages. (Well, against the mortgage originator charging prepayment penalties.) You don't owe interest until it accrues.
  - OJFord 5y ago
    Right, you 'owe the full amount of accrued interest'... Which is not as much as the amount that would've accrued if held to term. I think this is rather beside the point anyway!
    - deleted 5y ago
      [deleted]
finnh 5y ago
> you will not owe the full amount of the accrued interest Yes, you will. "accrued interest" is "unpaid interest as of the time of ___"; at the moment you sell the house you will have paid all of the interest up to that moment. There's no early-payment penalty on mortgages, as of the last many decades; maybe that's what you mean?
- liketochill 5y ago
  I have early payment penalties on my mortgage. Would love it if there weren’t. I’m in Canada.
  - finnh 5y ago
    ugh. sorry to hear it - didn't realize that Canada was still up to those tricks
ineedasername 5y ago
the resale value of a secondhand war is very low. "20 Year old slow-burn war available for reasonable price. Population w/ low morale, lots of growth potential! Motivated buyers only please."
- toast0 5y ago
  Maybe we should see if the first owner wants to buy it back?
  - ineedasername 5y ago
    I guess that's true, the war was owned by Russia before the US purchased it at a very steep markup, while the Russians probably got a good deal on it from the Brits after it sat on a shelf for a century or so. I'm hopeful, though not at all optimistic in the short term, that it will now be EOL'ed. Unfortunately, as a product class these things tend to be very durable, and families can pass them down for generations as a curiosity until someone decides to put it back in the market. Or some new startup sees a chance to innovate while moving fast and breaking things.
epistasis 5y ago
I don't think there's any clause in US bonds that lets the US pay back the debt to avoid future coupon payments, like there is with a mortgage. However, since there's an open market for t bills, the treasury could buy back a certain number of bonds that people are willing to sell. However it's not quite the same. The only reason that problem don't calculate the cost of the mortgage over time is that they are more concerned with asset values, not because it's better accounting.
jonnydubowsky 5y ago
"The resale value of a second-hand war" is a fantastic phrase! It sounds like a Neil Young lyric. Nicely done.

OJFord 5y ago

Of course you do, you're just typically rolling it into another mortgage on the next place. Anyway I didn't say and didn't mean it's the only valid interpretation of 'spent', just that it is one.

thaumasiotes 5y ago
No, you don't. You might in a state of nature, but the US has laws against prepayment penalties for mortgages. (Well, against the mortgage originator charging prepayment penalties.) You don't owe interest until it accrues.
- OJFord 5y ago
  Right, you 'owe the full amount of accrued interest'... Which is not as much as the amount that would've accrued if held to term. I think this is rather beside the point anyway!
  - deleted 5y ago
    [deleted]

finnh 5y ago

> you will not owe the full amount of the accrued interest Yes, you will. "accrued interest" is "unpaid interest as of the time of ___"; at the moment you sell the house you will have paid all of the interest up to that moment. There's no early-payment penalty on mortgages, as of the last many decades; maybe that's what you mean?

liketochill 5y ago
I have early payment penalties on my mortgage. Would love it if there weren’t. I’m in Canada.
- finnh 5y ago
  ugh. sorry to hear it - didn't realize that Canada was still up to those tricks

ineedasername 5y ago

the resale value of a secondhand war is very low. "20 Year old slow-burn war available for reasonable price. Population w/ low morale, lots of growth potential! Motivated buyers only please."

toast0 5y ago
Maybe we should see if the first owner wants to buy it back?
- ineedasername 5y ago
  I guess that's true, the war was owned by Russia before the US purchased it at a very steep markup, while the Russians probably got a good deal on it from the Brits after it sat on a shelf for a century or so. I'm hopeful, though not at all optimistic in the short term, that it will now be EOL'ed. Unfortunately, as a product class these things tend to be very durable, and families can pass them down for generations as a curiosity until someone decides to put it back in the market. Or some new startup sees a chance to innovate while moving fast and breaking things.

epistasis 5y ago

I don't think there's any clause in US bonds that lets the US pay back the debt to avoid future coupon payments, like there is with a mortgage. However, since there's an open market for t bills, the treasury could buy back a certain number of bonds that people are willing to sell. However it's not quite the same. The only reason that problem don't calculate the cost of the mortgage over time is that they are more concerned with asset values, not because it's better accounting.

jonnydubowsky 5y ago

"The resale value of a second-hand war" is a fantastic phrase! It sounds like a Neil Young lyric. Nicely done.