In its simplest form, a mortgage is a long-term loan that is designed to assist an individual in purchasing a home. As a borrower, you make monthly payments on the principal amount of the loan in addition to interest payments to the lender. While most homeowners today have a mortgage, it hasn’t always been this way.

The Modern Mortgage


The modern mortgage made its debut in the United States in 1934 when the government sought to help the country overcome the economic crash caused by The Great Depression. The government created a mortgage program that minimized the required down payment. The high value of real estate placed home ownership far out of reach for most. However, this program created great opportunity for people to borrow money for home ownership.


Before the mortgage program came about, a down payment meant 50 percent was required in order to purchase a home. Today, that number is around 20 percent (as it minimizes private mortgage insurance).


Mortgages, rates, lenders, interest rates and even some relevant history seem to make their way into the news quite frequently. With rates fluctuating on a daily basis, it’s important as a soon-to-be homeowner to pay close attention to news chatter. If you don’t have time to watch the news, you can read it on USA Mortgage’s blog or give us a call with any questions you may have. We are a trusted St. Louis mortgage company and we honor our business model, which includes educating our current and potential clients. Keep following us for more history, news, tips and expert advice.