BETA
The invention of the long-term loan
Established by the National Housing Act of 1934, the Federal Housing Administration insured longer loans. This allowed banks to offer 20-year, and later 30-year, fully amortizing mortgages with down payments as low as 10%.
Chapter 1
The birth of the 30-year loan
Chapter 2
How the money actually flows
Chapter 3
The invisible giant in the background
Chapter 4
Navigating your mortgage choices
Ch 1 · The birth of the 30-year loan
sloane Drag your payments onto the house to learn how a thirty-year mortgage actually works.
sloane American 30-Year Mortgage Loan
Fixed rate, thirty years, Goodbye, old mortgage fears! FHA helped it bloom, A stable living room!
sloane The Federal Housing Administration pioneered the modern 30-year mortgage to make homeownership affordable for ordinary families.
Fun Fact
Mortgage translation: The word mortgage literally comes from Old French words meaning 'death pledge,' coined by medieval lawyers.
sloane The economic crash of 1929 destroyed the early mortgage system, leading to widespread foreclosures and government intervention.
Glossary
mortgage (noun)
A legal agreement in which a person borrows money to buy property and repays it over time. The Federal Housing Administration introduced the thirty-year amortized version in 1934 during the Great Depression.
A legal agreement in which a person borrows money to buy property and repays it over time. The Federal Housing Administration introduced the thirty-year amortized version in 1934 during the Great Depression.
Quiz
Which US government agency, created in 1934, popularized the long-term amortized mortgage?
Quiz
During the peak of the Great Depression in 1933, approximately how many US home mortgages foreclosed each day?