First Mortgage

About First Mortgage

The concept of using property as collateral for loans dates to ancient Rome, but modern mortgage systems emerged in medieval Germany. German land banks allowed property owners to borrow against real estate. The concept spread to the Netherlands and Britain. The Dutch invented the modern mortgage bond in the 18th century. Building societies in 18th century England pooled member savings to fund home purchases. In the US, the savings and loan industry developed in the 19th century. The 30 year fixed rate mortgage, an American innovation, became possible through government backing via Fannie Mae and Freddie Mac, created in 1938 and 1970 respectively.