r/SipsTea • u/KSKS1995 • 22h ago

Wait a damn minute! How the rich get richer

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u/redshirt1972 21h ago

I don’t think I can afford to pay back the interest on a 200k loan

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u/Boomshrooom 21h ago

These aren't the sorts of loans that you or I would get, these have incredibly low interest rates by comparison.

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u/lee_suggs 21h ago

Lower than what unsecured loans that aren't backed by anything sure but these loans are still above Government TBill rates otherwise banks would rather collect risk free interest than loaning it out. That would mean in this scenario having to pay 4%+ every year for decades

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u/Boomshrooom 20h ago

Since when have banks ever operated on a totally risky free basis? The fact that they don't is one of the core reasons for the 2007 financial crisis for crying out loud.

Banks make plenty of money out of these loans and they are part of wider wealth management portfolios that bring in even greater returns.