Thursday, August 13, 2020

Will Healthcare Loans Take Away From Mortgage Loans?

 It was only a matter of time before a money company would figure out how to finance healthcare costs, especially with everything we are all facing at this time in our lives.


In theory, this company (described in the article linked at the conclusion) has an excellent idea in terms of enabling people to be able to pay off exorbitant health care costs over a period of time.


From the standpoint of impact, the guess is that real estate will be the industry to feel the negative impact from this idea. If and when this healthcare financing takes off, it is likely that thousands of people will receive these loans. Chances are the healthcare costs could be well into five figures and perhaps into six figures in come cases. 


Those are loans which will be the equivalent of a mortgage for these thousands of people. Logic tells us that if thousands of people now have healthcare loans which are equal to what a mortgage would be, the likelihood of also carrying a mortgage drops significantly.


Obviously, the need for personal (or family) healthcare financing is not a choice or an option like a mortgage is. Regardless, the odds are that people will concentrate on spreading out healthcare payments takes priority over buying vs. renting or combined living with other family members. 


As a result, this approach could be good for landlords and not good for sellers.

 

 https://www.americanbanker.com/news/new-subprime-lending-startup-will-focus-on-financing-healthcare

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