# News & Current Events > Economy & Markets >  Paying off mortgage during Hyperinflation?

## SilentBull

Theoretically, if you make sure to stock up on food to get ready for hyperinflation and your wages go up, does this mean you can pay off your fixed rate mortgage with your new salary? If someone has a $250,000 mortgage and gets paid $100,000 per year. During hyperinflation, his salary might go up to $1,000,000 per year. As long as this person already has everything he needs for everyday stuff, does this mean he can use the new salary to pay off the house, rather than spend it on buying loafs of bread?

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## Chester Copperpot

> Theoretically, if you make sure to stock up on food to get ready for hyperinflation and your wages go up, does this mean you can pay off your fixed rate mortgage with your new salary? If someone has a $250,000 mortgage and gets paid $100,000 per year. During hyperinflation, his salary might go up to $1,000,000 per year. As long as this person already has everything he needs for everyday stuff, does this mean he can use the new salary to pay off the house, rather than spend it on buying loafs of bread?


Theoretically yes.. This scenario happened to George Washington's cousin (or brother) who had just taken a mortgage on a large tract of land. As the continental currency became hyperinflated he found that he could pay his debt off rather easily.. However he felt this was unfair to his creditors who had lent him 'good money' so he re-negotiated with them for their benefit.

Washington also admonished him to not save up any of the paper money, else it melt like snow on a hot day.. (something to that effect)

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## silverlinkx2

That's pretty unlikely to happen again methinks, even so, if it did happen again interest rates would skyrocket along with the inflation so I don't see how it would make it easier.

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## SilentBull

> That's pretty unlikely to happen again methinks, even so, if it did happen again interest rates would skyrocket along with the inflation so I don't see how it would make it easier.


Yeah, but if the interest rate on the loan is fixed, they can't change it, right?

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## silverlinkx2

Eh, guess not.

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## Original_Intent

They can call in the loan within 30 days, at least I think it is 30 days.

This would force most people to refinance at a higher rate.

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## tmosley

> They can call in the loan within 30 days, at least I think it is 30 days.
> 
> This would force most people to refinance at a higher rate.


More likely it would force them to default.  I don't think you can just "call in" a loan anymore, as that was a big problem during the last Depression.  I may be wrong though.

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## Chester Copperpot

> More likely it would force them to default.  I don't think you can just "call in" a loan anymore, as that was a big problem during the last Depression.  I may be wrong though.


I think all loans are still technically callable.

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## silverlinkx2

Yeah I don't think they can do that anymore. I think that ended during the Great Depression.

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## Original_Intent

Did a little online research. It appears that most loans can only be called due under certain circumstances (the property was sold, payment delinquency, etc) From what I am reading it APPEARS that a bank cannot just call a loan due whenever they want. I could be mistaken but that seems to be the case.

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## SilentBull

> Did a little online research. It appears that most loans can only be called due under certain circumstances (the property was sold, payment delinquency, etc) From what I am reading it APPEARS that a bank cannot just call a loan due whenever they want. I could be mistaken but that seems to be the case.


So assuming the interest rate cannot be changed, and the loan cannot be called, it sounds like stocking up on things which will become very important and expensive is an excellent plan. Selling a bag of rice and then using that money to pay off your mortgage sounds possible. Then when things stabilize, if they ever do, one would be in pretty good shape, no?

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## silverlinkx2

If hyperinflation kicks in, paying off your mortgage will be the least of your concerns.

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## Original_Intent

> So assuming the interest rate cannot be changed, and the loan cannot be called, it sounds like stocking up on things which will become very important and expensive is an excellent plan. Selling a bag of rice and then using that money to pay off your mortgage sounds possible. Then when things stabilize, if they ever do, one would be in pretty good shape, no?


I would agree.

Someone said that in Weimar Germany you could by a city block with the buildings for a very small amount of gold. 1 oz.? I don't remember.

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## icon124

Hyperinflation isn't going to happen, so don't worry about it.

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## FreeMama

Hmmm I seem to remember Ron Paul AND Peter Schiff saying hyperinflation IS going to happen. . . Ron in his Texas Straight Talk and Peter every week on his show. Peter said something like best case situation would be half the dollar's current value lost. . . if we are really lucky.

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## Original_Intent

> Hyperinflation isn't going to happen, so don't worry about it.


Yeah I think if people keep using the dishonest CPI as a source of whether hyperinflation happens, you may be right. And I doubt we will ever get to the point of thousands of percent annual inflation at any rate. But I do think we will see 30% inflation, so I guess it depends on your definition of "hyper".

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## Chester Copperpot

> Yeah I think if people keep using the dishonest CPI as a source of whether hyperinflation happens, you may be right. And I doubt we will ever get to the point of thousands of percent annual inflation at any rate. But I do think we will see 30% inflation, so I guess it depends on your definition of "hyper".


Maybe "Super" Inflation????

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## danberkeley

Yes. But you are assuming your employer wont go bankrupt in the process and that you wont get laid off during the process.

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## Fox McCloud

yup, you can....as a matter of fact farmers were a big fan of inflation during the civil-war era; they would take out large loans, then pay them back later at a discount thanks to Lincoln's printings.

this environment is different though...I wouldn't count on your employer giving you continuous wage increases...

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## theoakman

> yup, you can....as a matter of fact farmers were a big fan of inflation during the civil-war era; they would take out large loans, then pay them back later at a discount thanks to Lincoln's printings.
> 
> this environment is different though...I wouldn't count on your employer giving you continuous wage increases...


if you can stay solvent before the crisis hits, you are fine.  There's nothing wrong with taking on a 30 year fixed where you have a good buffer.  Once hyperinflation hits, loans will be wiped out.  Normally, you have to be around a few months delinquent on your mortgage before they can even start a foreclosure preceding.  A simple strategy for paying off your mortgage in full may simply be to stop paying for a few months and let inflation get that much worse.  You may be able to simply get a job at minimum wage to pay off your house in full at that point.  

I remember when I was a child, I was in vacation at Mexico.  I still have the coins that say $500 on them.  They bought you a bag of chips.  I'm pretty sure some people were using them to pay off some sort of debt that was much more significant prior to the inflation.

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## Fox McCloud

> if you can stay solvent before the crisis hits, you are fine.  There's nothing wrong with taking on a 30 year fixed where you have a good buffer.  Once hyperinflation hits, loans will be wiped out.  Normally, you have to be around a few months delinquent on your mortgage before they can even start a foreclosure preceding.  A simple strategy for paying off your mortgage in full may simply be to stop paying for a few months and let inflation get that much worse.  You may be able to simply get a job at minimum wage to pay off your house in full at that point.  
> 
> I remember when I was a child, I was in vacation at Mexico.  I still have the coins that say $500 on them.  They bought you a bag of chips.  I'm pretty sure some people were using them to pay off some sort of debt that was much more significant prior to the inflation.


eh, I think it best to avoid debt altogether, especially in this situation...who knows _what_ the government many do to help stabilize the banks.

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## theoakman

> eh, I think it best to avoid debt altogether, especially in this situation...who knows _what_ the government many do to help stabilize the banks.


we already know what they government will do to stabilize the banks.  The same thing they are doing now.  Print dollars.  They don't care about the banks.  The government wants to avoid deflation because they are the worlds largest debtor.

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## Fox McCloud

> we already know what they government will do to stabilize the banks.  The same thing they are doing now.  Print dollars.  They don't care about the banks.  The government wants to avoid deflation because they are the worlds largest debtor.


I'm saying, if we go into a inflationary phase, the government could pass legislation forcing borrowers to pay at a higher rate, or one that's tied to inflation, or something of that general nature.

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## theoakman

> I'm saying, if we go into a inflationary phase, the government could pass legislation forcing borrowers to pay at a higher rate, or one that's tied to inflation, or something of that general nature.


well, who cares?  Then default on your debt.  The "what if" means nothing.  It's no different than a person defaulting on their ARM because they didn't like the rate reset.  The only difference is, they actually signed on the dotted line for that mortgage when someone on a 30 year fixed didn't.  It's called "fixed" for a reason.  If the government forces people to restructure contracts, the gig is up and you are living in a pure totalitarian state of tyranny.  Furthermore, the velocity of money can even outstrip the velocity of a congressional hearing.  The day the government tries to restructure everyone's mortgage is the day the people of the United State overthrow the government.  The government won't restructure the contract.  They'll simply raise your property taxes.  Why let the bank get more money when they can take more money from you directly through taxation?

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## Zippyjuan

> I'm saying, if we go into a inflationary phase, the government could pass legislation forcing borrowers to pay at a higher rate, or one that's tied to inflation, or something of that general nature.


No reason they would want to do that- retroactively re-write contracts.  One of the problems they are concerned about right now is the default rate on houses.  If they passed such a law the defaults would go through the roof.  The Government does not receive any more or less money based on the rate a person is paying on their mortgage.  Higher interest rates would mean more money a person who does not lose their home could deduct from their taxable income so that would reduce their tax revenue.  It would be completely counter- productive from their point of  view.

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## WRellim

> I think all loans are still technically callable.


Most mortgage loans cannot be "called in" -- Fixed rate mortgages are at set interest rates and for fixed terms; which cannot be changed w/o setting up a new contract.

What is all in the ARM and other mortgages God only knows.

BTW, this is something anyone doing a refinance (or new mortgage) these days needs to be especially careful of; while most states have laws regarding RE mortgages, that doesn't mean the banks won't try to slip in some "ambiguous" phrasing (they've become experts at that in the last few decades).

IMO anyone signing *any* new loan contract these days should be going over every single line and word of that contract, flagging it with questions and then meeting with a _knowledgeable_ RE lawyer to go over anything and everything that even remotely "smells" funny.

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## icon124

> Hmmm I seem to remember Ron Paul AND Peter Schiff saying hyperinflation IS going to happen. . . Ron in his Texas Straight Talk and Peter every week on his show. Peter said something like best case situation would be half the dollar's current value lost. . . if we are really lucky.


The "he said it so it must be true" statement really doesn't prove that there will be HYPERinflation.  Schiff is a good guy, but more often than not he over simplifies and assumes some things that are NOT true.  The fact of the matter is that the money supply is NOT increasing to cause inflation (only the monetary base) and the Fed has a ton of programs in place to sterilize the growth (if and WHEN it begins).  

Now I'm not saying that we won't see inflation, what I'm saying is that we won't see hyperinflation.  Do the research, Ron Paul and Schiff are very good men but not always 100% accurate in their statements.




> Yeah I think if people keep using the dishonest CPI as a source of whether hyperinflation happens, you may be right. And I doubt we will ever get to the point of thousands of percent annual inflation at any rate. But I do think we will see 30% inflation, so I guess it depends on your definition of "hyper".


See above.

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## ghengis86

uh....wages are the last thing to rise during an inflationary period.  if you think hyperinflation is all well and good for paying off debt, just ask the people of zimbabwe how its working out.  if you seriously think hyperinflation will be be good so that you can pay off a mortgage, you need to re-examine what hyperinflation really entails.  

prices change by the day, even hour.  and these are prices, not wages.  your employer won't be able to keep giving you raises on a daily, weekly or even montly basis.  no job, no income.  better have a fortune saved up.  don't have a ton of money lying around, that's okay, you have food.   but what about gas for your car? oh you walk? what about health insurance/healthcare? utilities? do you have enough wood to heat? generator for electricity? oops gotta buy gas for that.  unless you're living like the amish, you're going to get hammered by hyperinflation.

QED

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## slamminshaun

> I think all loans are still technically callable.


Only if the borrower does not perform as agreed.  For the most part, a fixed rate mortgage is set in stone.

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## theoakman

> uh....wages are the last thing to rise during an inflationary period.  if you think hyperinflation is all well and good for paying off debt, just ask the people of zimbabwe how its working out.  if you seriously think hyperinflation will be be good so that you can pay off a mortgage, you need to re-examine what hyperinflation really entails.  
> 
> prices change by the day, even hour.  and these are prices, not wages.  your employer won't be able to keep giving you raises on a daily, weekly or even montly basis.  no job, no income.  better have a fortune saved up.  don't have a ton of money lying around, that's okay, you have food.   but what about gas for your car? oh you walk? what about health insurance/healthcare? utilities? do you have enough wood to heat? generator for electricity? oops gotta buy gas for that.  unless you're living like the amish, you're going to get hammered by hyperinflation.
> 
> QED


if you have a steady job in a safe environment and savings that are protected, you certainly can pay off a house when hyperinflation hits.  You are painting the picture like I am telling people to go out and borrow as much money as they can.  I'm not.  There are plenty of people that can afford to take on 30 year fixed debt. If you've taken out a good level of debt, you don't need to have a wage increase to pay it off.   What about gas, what about food, what about electricity?  I'm not on record here telling people not to invest in those things now.  I've been quite the opposite telling people to buy food, gold, and invest in oil.  That doesn't mean you can't buy a house with someone elses money in addition to all of that.

You are also confusing one of the basic mechanics of hyperinflation.  Hyperinflation happens because money becomes rapidly transferred.  As soon as you get it, you go out and spend it.  In the beginning stage of hyperinflation, everyone will be spending money as fast as it comes in which will lead to a record amount of economic transactions occurring in the country.  In the first stage of hyperinflation, when the velocity of money starts getting out of control, you will find the economy in a state of near 100% employment because everyone is receiving and moving money around.  Then in a month or two, you have the collapse.  

You paint a picture in which people can't pay off that debt because they don't have any money.  That's hogwash.  The problem is that everyone has *too much* money.    Debt gets wiped out as long as you can stay solvent.  If your money is already protected, you most certainly can buy a house where you have a good buffer to maintain those monthly payments on a mortgage.

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## ghengis86

> if you have a steady job in a safe environment and savings that are protected, you certainly can pay off a house when hyperinflation hits.  *You are painting the picture like I am telling people to go out and borrow as much money as they can*.  I'm not.  There are plenty of people that can afford to take on 30 year fixed debt. If you've taken out a good level of debt, you don't need to have a wage increase to pay it off.   What about gas, what about food, what about electricity?  I'm not on record here telling people not to invest in those things now.  I've been quite the opposite telling people to buy food, gold, and invest in oil.  That doesn't mean you can't buy a house with someone elses money in addition to all of that.
> 
> You are also confusing one of the basic mechanics of hyperinflation.  Hyperinflation happens because money becomes rapidly transferred.  *As soon as you get it, you go out and spend it.*  In the beginning stage of hyperinflation, everyone will be spending money as fast as it comes in which will lead to a record amount of economic transactions occurring in the country.  In the first stage of hyperinflation, when the velocity of money starts getting out of control, you will find the economy in a state of near 100% employment because everyone is receiving and moving money around.  Then in a month or two, you have the collapse.  
> 
> You paint a picture in which people can't pay off that debt because they don't have any money.  That's hogwash.  The problem is that everyone has *too much* money.    Debt gets wiped out as long as you can stay solvent.  If your money is already protected, you most certainly can buy a house where you have a good buffer to maintain those monthly payments on a mortgage.


no, i know exactly what you're saying but you, the wage earner, are the last to get the money to spend.  

also, how are things working out for zimbabwe?

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## theoakman

> no, i know exactly what you're saying but you, the wage earner, are the last to get the money to spend.  
> 
> also, how are things working out for zimbabwe?


well, obviously you didn't get what I was saying because the smart wage earner doesn't take out more deb than he can cover and does not need an increase in wage to pay off that 30 year fixed.

rofl, please reference where I said things were good in Zimbabwe.  I suggest you talk to someone who's lived through hyperinflation.  I've got 2 friends who have.  One paid off his debt with pocket change.  Debt becomes worthless.  You haven't given a sound argument as to why someone who has a 30 year fixed is going to be in trouble when hyperinflation hits.  They are only at risk of being in trouble if they are in trouble before it hits.  When it hits, even if you are out of a job, you could sell a few silver coins to pay off your debt.  In fact, you could probably go around and pick the money up off the ground to pay it off.

I'll repeat it again.  The problem is not that people don't have money to pay off their debt.  The problem is that they have too much money.

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## WRellim

> well, obviously you didn't get what I was saying because the smart wage earner doesn't take out more deb than he can cover and does not need an increase in wage to pay off that 30 year fixed.
> 
> rofl, please reference where I said things were good in Zimbabwe.  I suggest you talk to someone who's lived through hyperinflation.  I've got 2 friends who have.  One paid off his debt with pocket change.  Debt becomes worthless.  You haven't given a sound argument as to why someone who has a 30 year fixed is going to be in trouble when hyperinflation hits.  They are only at risk of being in trouble if they are in trouble before it hits.  When it hits, even if you are out of a job, you could sell a few silver coins to pay off your debt.  In fact, you could probably go around and pick the money up off the ground to pay it off.
> 
> I'll repeat it again.  The problem is not that people don't have money to pay off their debt.  The problem is that they have too much money.


No, they do NOT have "too much money" -- ever-increasing denominations are meaningless when the cost of the necessities increases FASTER than the wages of those needing them to live.

Once inflation begins to "dig into" an economy, prices of everything begin to rise steadily (every day, bit by bit) -- wages will rise in a delayed fashion, in spurts, only FOLLOWING price increases -- when companies HAVE increased revenues (from increased prices) and even then only when their employees are on the verge of "revolt" and the employers absolutely MUST pay their employees more (or risk having them starve/steal/quit to work somewhere else, anywhere that is willing to pay them in CURRENT nominal money terms.)  

And many, indeed, nearly all companies will try to get by with as FEW employees as possible.

If an economy slips into "hyperinflation" then the environment changes drastically, everything is done NOW and in CASH-ONLY terms: money gets passed around and spent quickly -- _solely in order to attempt to turn it into something, anything, that will RETAIN its value --_ people begin buying whatever they can, in bulk and even "hoarding" if necessary, because otherwise if they hold onto cash, it's actual value in terms of exchange goes "poof" like Cinderella's dress and carriage; and anything that is not quickly converted... well, "after midnight" it becomes not worth a rotten pumpkin.

*Hyperinflation is NOT a pleasant experience for anyone in the general population* -- and that means YOU -- it is only slightly better than an environment of total chaos/looting (and if hyperinflation continues, there's a good chance that both of the latter will ensue).

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## theoakman

> No, they do NOT have "too much money" -- ever-increasing denominations are meaningless when the cost of the necessities increases FASTER than the wages of those needing them to live.
> 
> Once inflation begins to "dig into" an economy, prices of everything begin to rise steadily (every day, bit by bit) -- wages will rise in a delayed fashion, in spurts, only FOLLOWING price increases -- when companies HAVE increased revenues (from increased prices) and even then only when their employees are on the verge of "revolt" and the employers absolutely MUST pay their employees more (or risk having them starve/steal/quit to work somewhere else, anywhere that is willing to pay them in CURRENT nominal money terms.)  
> 
> And many, indeed, nearly all companies will try to get by with as FEW employees as possible.
> 
> If an economy slips into "hyperinflation" then the environment changes drastically, everything is done NOW and in CASH-ONLY terms: money gets passed around and spent quickly -- _solely in order to attempt to turn it into something, anything, that will RETAIN its value --_ people begin buying whatever they can, in bulk and even "hoarding" if necessary, because otherwise if they hold onto cash, it's actual value in terms of exchange goes "poof" like Cinderella's dress and carriage; and anything that is not quickly converted... well, "after midnight" it becomes not worth a rotten pumpkin.
> 
> *Hyperinflation is NOT a pleasant experience for anyone in the general population* -- and that means YOU -- it is only slightly better than an environment of total chaos/looting (and if hyperinflation continues, there's a good chance that both of the latter will ensue).


I'm not claiming it's a pleasant experience.  What you guys are failing to recognize is that you can easily pay off a fixed rate mortgage during hyperinflation because you'll have a dollar bill in your pocket with more than 3 zeros on it.  In fact, I got a mexican coin with 2 zeros on it.  If I have money invested in gold, silver, oil, food, and a steady job that pays 4k a month, I don't run the risk of defaulting on a home where I pay 1200 a month, hyperinflation or no hyperinflation.  That's a fact.

Btw, hyperinflation doesn't always lead to total chaos.  In fact, it often doesn't at all.  I'm not advocating people don't take the necessary precautions to protect themselves, but the mad max scenario rarely unfolds.  There's no doubt that crime will increase, but the war zone that many people envision doesn't happen too often.  In fact, this country has gone through hyperinflation already without much fallout.  You are more likely to see a lifestyle similar to that of the great depression rather than total chaos.

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## ghengis86

> I'm not claiming it's a pleasant experience.  What you guys are failing to recognize is that you can easily pay off a fixed rate mortgage during hyperinflation because you'll have a dollar bill in your pocket with more than 3 zeros on it.  In fact, I got a mexican coin with 2 zeros on it.  *If I have money invested in gold, silver, oil, food, and a steady job that pays 3k a month, I don't run the risk of defaulting on a home where I pay 1200 a month, hyperinflation or no hyperinflation.  That's a fact.*
> Btw, hyperinflation doesn't always lead to total chaos.  In fact, it often doesn't at all.  I'm not advocating people don't take the necessary precautions to protect themselves, but the mad max scenario rarely unfolds.  There's no doubt that crime will increase, but the war zone that many people envision doesn't happen too often.  In fact, this country has gone through hyperinflation already without much fallout.  You are more likely to see a lifestyle similar to that of the great depression rather than total chaos.


i'm using zimbabwe as an example of how hyperinflation ruins everything, not that you said anything good about it. don't be obtuse. 

yes you still risk defaulting on your mortgage regardless of what you're making and how much your payments are.  your money is worthless.  you'll be paying 3k for a gallon of gas to get to your 'steady job'.  yes, debt will be easier to pay off. you're right.  but having 'too much money' is not the problem.  the money is worthless so it doesn't matter how much you have i.e. after buying necessities (medicine, healthcare, electricity, gas, etc.) there's nothing left.

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## theoakman

> i'm using zimbabwe as an example of how hyperinflation ruins everything, not that you said anything good about it. don't be obtuse. 
> 
> yes you still risk defaulting on your mortgage regardless of what you're making and how much your payments are.  your money is worthless.  you'll be paying 3k for a gallon of gas to get to your 'steady job'.  yes, debt will be easier to pay off. you're right.  but having 'too much money' is not the problem.  the money is worthless so it doesn't matter how much you have i.e. after buying necessities (medicine, healthcare, electricity, gas, etc.) there's nothing left.


did you miss the part about protecting the money you have right now?  If you are already invested in gold, silver, and everything else that will go up in price, there's no harm in borrowing someone elses money that you can already afford to pay off to buy a hard asset like a home.

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## fj45lvr

> Hyperinflation isn't going to happen, so don't worry about it.


 
Huh??   

http://www.cnbc.com/id/15840232?video=1005419227&play=1

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## SilentBull

> No, they do NOT have "too much money" -- ever-increasing denominations are meaningless when the cost of the necessities increases FASTER than the wages of those needing them to live.
> 
> Once inflation begins to "dig into" an economy, prices of everything begin to rise steadily (every day, bit by bit) -- wages will rise in a delayed fashion, in spurts, only FOLLOWING price increases -- when companies HAVE increased revenues (from increased prices) and even then only when their employees are on the verge of "revolt" and the employers absolutely MUST pay their employees more (or risk having them starve/steal/quit to work somewhere else, anywhere that is willing to pay them in CURRENT nominal money terms.)  
> 
> And many, indeed, nearly all companies will try to get by with as FEW employees as possible.
> 
> If an economy slips into "hyperinflation" then the environment changes drastically, everything is done NOW and in CASH-ONLY terms: money gets passed around and spent quickly -- _solely in order to attempt to turn it into something, anything, that will RETAIN its value --_ people begin buying whatever they can, in bulk and even "hoarding" if necessary, because otherwise if they hold onto cash, it's actual value in terms of exchange goes "poof" like Cinderella's dress and carriage; and anything that is not quickly converted... well, "after midnight" it becomes not worth a rotten pumpkin.
> 
> *Hyperinflation is NOT a pleasant experience for anyone in the general population* -- and that means YOU -- it is only slightly better than an environment of total chaos/looting (and if hyperinflation continues, there's a good chance that both of the latter will ensue).


What theoakman is saying (and I agree) is that even if you don't have a job you could sell a silver coin and pay off your mortgage with that. What he is saying is that even without the wage increase, anything you can sell can give you enough money to pay off an old debt.

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## theoakman

> What theoakman is saying (and I agree) is that even if you don't have a job you could sell a silver coin and pay off your mortgage with that. What he is saying is that even without the wage increase, anything you can sell can give you enough money to pay off an old debt.


EXACTLY!

I'm sure this guy would have a hard time paying off a mortgage he took out 8 years ago.  /end sarcrasm

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## tsopranos

I was just going to ask if anyone knew any good articles written about this topic...so I googled "hyperinflation paying off fixed mortgage" and this thread comes up as the 1st result, ha!  Will report back here if I find anything good.

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## Wulfslæd

The principle and interest portion of your payment would stay the same, but what about the escrow portion?  I would think the banks would be raising that portion of your payment in line with inflation.  If they waited 12 months to adjust your escrow payment like they do now, there wouldn't be nearly enough in your escrow account to pay for taxes and insurance, so they'd have to increase your escrow deposit every month.  Meanwhile your wages might not be able to keep up with the increase.

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