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Twomix
China Observer
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Comments by "Twomix" (@twomix1822) on "China Has 400 Million Mortgage Slaves, With 8% Ending Up With Unfinished Properties" video.
What's worse is even if you declare bankruptcy and the banks confiscate the property and the property is sold you are still owed the initial cost of the loan. There is no debt discharge law in China unlike in the US (where the debt is fully discharged if the loan defaulted due to bankruptcy). Example: let's say if you buy a house for $1M and you paid 300K, then you became unable to pay. The bank can reposses and sell the home in an auction. Let's say the home sold for $500K + $300K principle = $200K balance. In the US, the $200K is eaten as a loss by the bank but in China, the $200K must still be repaid on top of interest and fees. In CCP China they kick you twice when you are down.
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@NZeiram in the Philippines there is something called pre-selling. You pay for 20% of the cost of the home as an initial deposit. The 80% balance isn't due until the finished home is turned over to the buyer. In return you get a special pre-selling price which is a deep discount. That is totally unlike China where you need to start paying for a mortgage loan before the house was even built. Also in the Philippines, you are not legally obligated to buy the house you deposited on. Example: if you see a house or condo for say 3M, you pay a presell fee of around 600K. If you decide you no longer want or are incapable of buying the house or condo you can simply walk away although you could lose your initial deposit.
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Nope only in China where you need to fully pay for something you haven't even seen.
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It's called a new homeowner's excitement. They are so excited at owning their own first homes they are blindsided by the small prints. Also new couples tend to over estimate their income potential. Also note their incomes were unexpectedly reduced due to COVID also unforeseen expenses like pregnancies.
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@travisli-rufus1949 Good question. Most people in the predicament tighten their belts, and start all over again. Some commit suicide. Some leave China when they can by any means necessary.
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@minimaster96 just look up US debt discharge law. I like to provide you with a link but YouTube keeps erasing it.
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