8 Facts About Mortgages That You Did Not Know
If you think you know everything about mortgages, think again. Most people get a mortgage some time or another, and a lot of people don’t even ask where it came from or how did it come to be?
Well, if you’re planning on impressing your friends and family with some little-known mortgage facts, you’re in the right place! Here are some few facts about mortgages that you didn’t know.
The First Time the Word Mortgage was Used, It Didn’t Have Anything to do with Housing
During the early times, the word mortgage was spelled as “morgage.” It was in the 1300s when Confessio Amantis wrote a poem about it. In it, a mortgage was used to describe marriage and not a home loan. Now that’s a shock!
The Mortgage is Related to Death
Mortgage originates from an Old French word “mort gaige” or “morgage” which means “dead pledge.” Its kind of like your mortgage dies once you fail to pay or pay it off.
A Lot of People Don’t Have a Clue About Mortgages
According to a survey conducted by CNN Money, less than two-thirds of people in the survey didn’t have any clue as to what “Annual Percentage Rate” means while another two-thirds thought that each lender has to charge the same fees for each customer as required.
However, those are far from the truth. The lender can charge you whatever price he or she wants for your appraisal and credit check. It is one of the reasons why shopping around is recommended when you are trying to look for a mortgage.
Red Doors Mean Mortgage-Free
Did you know that colors also have something to do with mortgages? In Scotland, people who have paid off their mortgages paint their front doors red. So when you finally pay off your mortgage, why not invest in a bucket of red paint? That’ll come in handy.
The American Mortgage has Changed
Nowadays, thirty-year mortgages are new. However, during the Great Depression, mortgages only had very short maturity times. And when you have to make a down payment, it is usually very high. It is what the American Mortgage in Historical and International Context says. Before the Depression, mortgages had variable interest rates. In addition, they were usually renegotiated and on a yearly basis at that! Now that’s something.
First-Time Buyers are Fewer
First-time buyers often occupy as much as 40% of the housing market. But lately, this number has become lower. According to the National Association of Realtors (NAR), only 38% were first-time buyers in 2013. If you’re a first-time buyer availing of FHA Loans Fort Worth, then you’re included.
There are a Lot of Mortgage Debt
In the third quarter of 2013, as much as 13 trillion USD was mortgage debt according to the Federal Reserve. The one-to-four-family residences are the one with the most mortgage debt.
Freddie and Fannie
In 1938, President Franklin Roosevelt created Fannie Mae in hopes of freeing up money for lenders. In 1970, Freddie Mac was created. It was only just after Fannie Mae turned into a publicly traded company. The government probably never anticipated these two organizations to become so large. Now, Fannie and Freddie own at least half of the mortgages in the country when combined.