Aug 27, 2008

Mortgage History: Think Getting a Mortgage Today Is Tough?

With the foreclosure crisis and the tightening up of credit, getting a mortgage feels like it's harder than ever -- or is it? Let's take a look back in time.

Back before the Depression, home mortgages typically extended for ten years -- not the generous 30 years we're used to now -- and a down payment of 50% of the home's purchase price was expected.

Not surprisingly, this kept a lot of people out of the housing market. In 1940, only about 44% of household heads owned homes. It was only when the federal government stepped in by backing long-term mortgages, thus creating an incentive to homeownership, that the shift to the standard 30-year mortgage with lower down payments began.

The source for these fun mortgage facts? A book called Theorizing Discrimination in an Era of Contested Prejudice, by Samuel Roundfield Lucas.