They can pay those mortgages in the moment they sign for them.
They cannot necessarily pay those mortgages after inflation screws up the rest of their month to month budget.
People always love to circle jerk about inflation "inflating away your mortgage" but that's only if you manage to hold onto it.
Wages lagging inflation will still hurt a lot of people. "Just switch jobs" doesn't work in every industry and even where it does you're gonna stagnate in terms of skill/experience due to ramp up times in new roles so you're basically borrowing from your future earning potential by doing that. <Insert ye olde quip about "10yr of experience being a junior developer vs being a senior developer" here>
Unfortunately most people who championed the bad decisions that got us here are wealthy enough to weather the storm with little more than reducing their retirement contributions.
It is also funny that people think banks do not want you to default on your mortgage. What did they learn from 2008? They can hand out mortgages ignoring valid economic signals that these people will not be able to repay it, they will then get your house and the government will bail them out and make laws against sleeping in a public place.
Houses are worth far less if they are foreclosed on or left without upkeep, so everyone loses money. There is no universe where banks want to take over a house and deal with the overhead of foreclosure and reselling instead of keeping the monthly revenue stream they signed up for.
They cannot necessarily pay those mortgages after inflation screws up the rest of their month to month budget.
People always love to circle jerk about inflation "inflating away your mortgage" but that's only if you manage to hold onto it.
Wages lagging inflation will still hurt a lot of people. "Just switch jobs" doesn't work in every industry and even where it does you're gonna stagnate in terms of skill/experience due to ramp up times in new roles so you're basically borrowing from your future earning potential by doing that. <Insert ye olde quip about "10yr of experience being a junior developer vs being a senior developer" here>
Unfortunately most people who championed the bad decisions that got us here are wealthy enough to weather the storm with little more than reducing their retirement contributions.