Everything I Need to Know I Learned in Mortgage Class
17 January, 2012 / by Bryan Jaskolka
Mortgages, second mortgages, home equity loans, and secured lines of credit. How many of us graduated from high school knowing everything there was to know about these topics? How many of us knew how much of a down payment we would need to buy a home; or even how much the average home cost in our area? Were we aware of the Bank of Canada’s interest rate, or how bonds affect fixed rate mortgages?
If we’re being honest, there were probably a lot of mortgage-related topics that many of us were ignorant about the day we accepted our diploma. But shouldn’t we be a little more aware of them? If high school is going to prepare us for not only post-secondary education but also to live in the world around us, shouldn’t we be given some education as to how to live in it? And how to make those really big decisions, such as how to buy a home? After all, we learn what ‘x’ equals, how to dissect a frog, how to cook a meal and even how to fix our car. Why are we not learning how to save for, and afford the home that we will one day live in?
For many homebuyers, learning how to obtain a mortgage or even look for a house for that matter, is a learning experience that they do not get to have until it’s time to actually do it. This not only creates a huge problem of consumers that have to blindly follow lenders and real estate agents, but it doesn’t do much for our economy either. Think about that for a second. If our general population is made up of people who don’t know how to buy a home or handle their own finances, what does that do for the economy? It puts a lot of money into the hands of those that don’t know what to do with it – and that’s always a dangerous prospect.
The fault is not of course, on those that hold their own money; and our education system can’t be blamed either – we have one of the best ones in the world. But, could we improve it some? Could we start incorporating classes that teach young people what they need to apply for a mortgage, and how to wisely borrow against their home equity? Could we teach them about variable and fixed interest rates, and explain how bonds work and make their impact? It might just help with the warnings the government keeps giving us about lowering our debt, and that might just put some money back into the economy. And even more than that, it would allow homebuyers and people applying for a mortgage knowledge that they can carry with them their whole life. And it would take the stress out of buying a home. Can you imagine it? A stress-free home-buying process?
What do you think? Do you think our kids should be taught about mortgages in school?