Today I thumbed through a magazine of an estate agent, I read an ad and try to suggest the purchase of a home in Naples (Capodimonte area), 3 rooms (2 bedrooms, 1 living room, kitchen and bathroom), 75 sqm. at a cost of € 260,000.00. I asked but what would cost me to buy this house by opening a mortgage?
Best offer on the market on March 3, 2011 for a fixed rate mortgage and rate constants:
-selected bank: Banco di Napoli SpA
-cost house: € 260,000.00
-monthly flat rate: € 1,500 No. 81-
rate: 360
-monthly term of the loan: 30 years
-APR: 5.88%
interest the bank: € 280,292.70
share capital: € 260.000,00
miscellaneous costs € 2344.90
total cost of the loan: € 542,637.60
From this example shows that a bank (and here we talk about the best deals on the market today) asks PIU 'double the price of To grant the loan: a home that costs 260 thousand € 280 thousand € asks you to share-interests to be returned.
addition, to obtain a loan you have to give guarantees, those requests usually are:
- Guaranteed Income:
E 'to have a sufficient income for repayment of the principal paid. Usually, the maximum duration that is considered by the bank can fluctuate between 35 and 50% of household income.
- collateral:
The other guarantee offered to the bank for the disbursement of the loan is that you buy the property on which a mortgage is recorded 1st grade.
This means that in case of non-payment of loan installments to the bank, after giving notice to the borrower at the return of payments made, he may transfer the case to its legal department for recovery of credit up to the request to sell the goods at auction (and then you lose home).
The mortgages are usually made for a sum greater than the amount of the mortgage, and ranges from 150% to 250% of the amount required.
Well I guess many of you will already have a high level of bile to the nervousness in reading these figures, but hang in there for this other thing I am going to say.
Banks create the money you pay NOTHING FROM , with no real equivalent, that figure just by typing on their PCs computer.
know how they do it?
easily using the fractional reserve : the percentage of bank deposits that the bank is required by law to hold in the form of cash or assets readily convertible into cash, ie the set of accounting items that, as a proportion of deposits, a credit institution can not deliver. In Europe we have a reserve
fazionaria 2% as determined by ' Article 4 of Regulation 1745/2003 of the ECB.
This means that if you go to the bank to deposit € 1000 in your account, the bank has an obligation to "keep on hand " only 2% of that amount or 20 euro and pay the remaining 98% or 980 € to those who want a loan.
This is also called "multiplier bank" because compared to a rate of 2% of reserves the bank can get to pay up to 50 times as much: A deposit of € 100.00 € 5,000.00 generates, creating € 4,900.00 from nothing.
What are the consequences of this trick of the deposit-loan related to the fractional reserve banking:
- create money ex-nihilo
- claim by the buyer guarantees equal to 3 times the amount of the loan requested
- claim a share interest of \\ higher than the share capital (eg, but you get to borrow 100 undue 200)
- borrow the purchaser of a property to work for 1 / 3 of his day for 20-30-40 years of his life to pay the installments of the loan (always hoping that this has a job and a living standard that permits the payment of each installment until ' the debt)
- more if the buyer fails to pay the mortgage payments, the banks took possession of the house and sell it at auction, leaving the buyer with nothing in hand.
This is just one aspect of our banking system, in which the protagonists (the banks) enslave people, mostly unaware of the actual operation of monetary and banking mechanisms.
The ridge is that the buyer seems to be almost grateful that the operator of bank lending, without knowing that you are indebted for 30 years of his life by offering the sacrifice of his job, his savings, his time, all in exchange for a number typed on a computer.
The fractional reserve (secondary seignorage) is one of the reasons why:
1) if all depositors of a bank were marked with X is the counter to claim all the money into your bank account that they were not, simply because all that money THERE deposited into the coffers of the bank .
Try asking your bank manager: "What if tomorrow all depositors of this branch line up and want to collect your money? " I'm sure you would a vague answer and embarrassed, if you answer!
2) this can be explained by the increasing pressure to offer free online checking accounts and credit card \\ debit in the gift, because you want to manage all the money electronically so much easier for the banks, removing all paper money.
If you want to know more about searching the web: Seigniorage primary, secondary seigniorage, fractional reserve.
Salvatore Tamburro
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