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MortgagesMortgages are a type of property loan that financial institutions, such as banks and credit unions, can offer when a prospective buyer decides against paying a property’s full cost in cash.
The lender provides funds to the borrower to purchase the property, and the borrower pays them back over a fixed time period, typically between 10 and 30 years. On top of paying back the base cost of the property, also called the “principal,” the borrower pays monthly interest to the lender.
Most buyers also pay a down payment—a portion of the property’s overall cost—to help reduce interest on their loan.
In 2024, 74% of homebuyers took out a mortgage. Debt owed on mortgages made up about 70% of US consumer debt as of 2025.Explore Mortgages
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Beyond oil, the Iran war is pushing up costs on fertilizer, prescriptions, and mortgages, tooGas is up 27% since fighting began, but the Strait of Hormuz also carries a third of the world's fertilizer, petrochemicals used in generic drugs, and helium for semiconductor manufacturing. Mortgage rates have climbed back above 6.4%, and economists warn $130 oil could tip the U.S. into recession. InvestopediaMortgages are loans used to buy propertyA mortgage is a loan used to buy property, like a house. Borrowers typically put down a percentage of the cost of the home, and the amount left over is financed through a lender, like a bank. ZillowMortgages evolved from exclusive agreements for the wealthy into a key part of homeownership todayThe word "mortgage" comes from medieval French, meaning "death contract"—but the modern American mortgage has a more recent and complicated history. This explainer looks at how mortgages evolved from exclusive agreements for the wealthy into a key part of homeownership today, including the impacts of New Deal policies, redlining, and the Fair Housing Act. 1440Hear what Michael Burry thinks about the possibility of an AI bubbleSince his success shorting subprime mortgage-backed securities in 2008, Burry's positions have often become influential, sparking conversations on platforms like X. In 2025, Burry drew attention for betting against Nvidia and Palantir for being overvalued companies. SpotifyIn 2008, the 'Big Short' mastermind Michael Burry made more than $700MBefore the 2008 housing crisis, Burry used credit default swaps to bet against subprime mortgage-backed securities that fueled the 2008 housing crisis. His firm made more than $700M for its investors, and Burry made more than $100M in personal profits. InvestopediaTranches slice financial products into segmentsSpecifically, tranches are slices of securities (think: bonds or mortgages) divided by risk and characteristics to attract different investors with a variety of risk tolerances. InvestopediaThe Federal Reserve fought the Great Recession primarily with quantitative easing and repurchasing agreementsDuring the Great Recession, the Fed stimulated the economy by buying people and businesses' debt, notably through purchasing mortgage-backed securities and buying bonds with slim margins. The two processes, quantitative easing and repurchase agreements, both helped increase the amount of money in the economy to increase consumer spending. Marginal Revolution UniversityIn real estate, a larger down payment can reduce your loan amountHowever, the trade-off is liquidity: Tying up too much cash in a home can reduce emergency savings and delay your purchase. Redfin | Real Estate Tips for Home Buying, Selling & MoreThe average US household carries $105,056 in total debtThis article breaks down the average household debt by category, including credit card debt ($6,523), personal loans ($11,274), and more. The Motley FoolOwning a home can help build wealth via tax benefits and moreIn addition to tax benefits and the potential to build equity in your home, houses are also typically considered an appreciating asset. That means their value is likely to increase over time. RedfinSwitzerland's household debt totals 125% of its GDPSwitzerland, Australia, and Canada are among the countries with the highest household debt in the world. This debt typically includes mortgages, automotive loans, credit card debt, and personal loans. Visual CapitalistIn President Trump's first year of his second term, inflation fell from 3% year-over-year in January 2025 to 2.7% in DecemberWhile the price of eggs and bread went down over Trump's first year in office during his second term, coffee and beef prices rose. Utility bills and home insurance continued to surge, but mortgage rates, rent, and home prices began to stabilize in 2025. Kiplinger15 out of 25 major US cities have a lower cost of living than their nearby suburbsThese cities are Los Angeles, Chicago, Dallas, Philadelphia, Phoenix, Boston, San Francisco, Detroit, Minneapolis, Denver, Baltimore, St. Louis, Orlando, Charlotte, and San Antonio. This article details the cost of living in major US cities versus their nearby suburbs, according to data from 2023. GOBankingRatesThe 2008 financial system unraveled in a wave of speculationMichael Lewis—author of the bestselling "The Big Short"—explains how a wave of speculation (among other factors) drove the 2008 collapse, from lenders issuing risky mortgages to Wall Street turning them into fragile securities. He also highlights the few outsiders who recognized the bubble and bet against it before the crash. 60 MinutesThe movie adaptation of ‘The Big Short’ provided a visual for the 2008 housing bubbleA scene from "The Big Short" visualizes how Wall Street bundled shaky mortgages into complex housing bonds and sold credit default swaps on top of them—showing, step by step, how the structure of the 2008 housing bubble was vulnerable to collapse. YouTubePrivate mortgage insurance protects the lender rather than the borrowerAlso known as a “PMI,” private mortgage insurance may be required for those who have a conventional loan and put less than 20% down on their home. A PMI could also be required for someone refinancing their mortgage if they have less than 20% equity remaining in the property. CBS NewsThe average monthly mortgage payment in the US costs 38% more than monthly rentA recent study showed that the price gap between renting and buying grew in 38 major US metro areas since last year. The metro areas with the smallest price gaps between renting and buying include Detroit, Philadelphia, and Cleveland. BankrateFor much of human history, homeownership was primarily associated with the eliteBefore the Industrial Revolution, early mortgages were rather exclusive loans given only to nobility. But as more people gained more wealth through the Industrial Revolution, banks began to take on “higher-risk” loans to everyday people. InvestopediaUS homeownership rates declined from the start of the Great Recession through 2016In 2004, the US homeownership rate was 69%. When the bubble popped in 2007, due to a variety of factors (including the prevalence of subprime mortgages) the Great Recession began. Foreclosures increased, as did the ratio of renters to homeowners. In 2016, the homeownership rate was at roughly 63.4%. USA FactsSurprising costs associated with homeownership include taxes and roof maintenanceOwning a home includes not just expected costs such as a mortgage, homeowners insurance, and landscaping, but also less-obvious expenses like property taxes, repairing and maintaining one’s roof and HVAC system, and HOA fees. InvestopediaA ‘rent vs. buy’ financial calculatorThe New York Times built a continuously updated financial calculator to help potential homebuyers figure out which makes more sense given their individual situation: buying or renting a home. It takes into account how long someone plans to own the home for, mortgage rates, and more. New York TimesInvestors collectively own $28T in US Treasury securitiesThe 10-year Treasury yield is a central measure of the health of the economy, shaping how much both the government pays on its debt and the cost of borrowing for the private sector. This explainer provides stats and explainers on the important metric. EconofactWhy can’t we just turn the empty offices into apartments?As both rent prices and mortgage rates rise across the US, many companies have simultaneously continued operating hybrid or remote workforces post-pandemic. A podcast episode dives into why city dwellers aren't all living in their pre-pandemic break rooms just yet. Search EngineThe Federal Reserve Bank of Atlanta provides a monthly measure of home ownership affordabilitySpecifically, the Home Ownership Affordability Monitor shows a monthly measure of the median-income household's capacity to afford the median-priced home at the national level, the metro level, and more. Federal Reserve Bank of AtlantaRecessions are considered to be inevitable by modern economic standardsRecessions are caused by imbalances in the market and are guaranteed to happen in capitalist systems, but predicting them is a complex task. McKinsey & CompanySears and Roebuck once sold DIY house kitsBetween 1908 and 1940, "kit homes" that buyers could build themselves were advertised in Sears’ famous catalog—and many of them are still standing today. SearsHouses.comCredit cards were the fourth-highest source of US consumer debt as of 2024US consumer debt nationwide totaled $17.9T as of 2024 Q3. Mortgage debt ranked as number one, with student loan debt coming in at number two. Education Data InitiativeRefinancing a mortgage is when a homeowner exchanges their current loan for a new oneHomeowners typically refinance to secure a lower interest rate and potentially a new loan term length. Debt owed on mortgages made up about 70% of US consumer debt as of 2025. MarketWatchSecuritization has become common practice in home financingWhen a homebuyer finances with a lender, they aren’t necessarily the one footing the bill. After a buyer secures a home loan, the lender can sell the loan to another financial institution or a private institution. That group can later sell that mortgage to investors. This is called securitization. Federal Reserve Bank of ChicagoThe rare, so-called 'assumable' mortgage is landing homebuyers a 3% rateHigh interest rates in a competitive market are part of the reason some buyers struggle to close on homes. But this rare mortgage can help. Assumable mortgages allow buyers to take over the original mortgage from the seller, giving them a much lower interest rate. CNBCThe 30-year fixed-rate mortgage is by far the most popular in the USThe most common types of loans are conventional, jumbo, fixed-rate, adjustable, and government-backed. LendingTreeMortgage calculator: How much can you borrow?How much you could pay per month for a mortgage heavily depends on your financial standing, the cost of your property, and how much time you want to spend paying it off. Get a better understanding of what you can afford—and what you might be offered from a lender—with a mortgage calculator. NerdWallet30-year fixed mortgage rates have changed significantly over timeIn the 1980s, 30-year fixed mortgage rates peaked just under 17%. During the COVID-19 pandemic, they were much lower, hovering around 3%. Federal Reserve Bank of St. LouisFannie Mae and Freddie Mac are federal housing enterprises originally established to offer affordable housing loans to buyersThe Federal National Mortgage Association is commonly called Fannie Mae, and the Federal Home Loan Mortgage Corporation is called Freddie Mac. Since Fannie Mae’s creation in 1938 and Freddie Mac’s in 1970, they’ve become staples of the housing market. The Wall Street JournalMortgage insurance offers help to buyers who can’t afford to put down 20% up frontBuyers who need mortgage insurance end up paying more per month on top of their loan to cover the added insurance. At its core, mortgage insurance helps buyers purchase a home they can’t afford, letting them put down 20%, while protecting lenders offering potentially risky loans. Consumer Financial Protection BureauThe National Housing Act established the Federal Housing AdministrationDuring the Great Depression, 1,000 homes were foreclosed on per day, and half of the mortgages across the country defaulted. To address this crisis, President Franklin D. Roosevelt signed the National Housing Act. It established the Federal Housing Administration, which is still around today and helps protect lenders and buyers. BankrateBuyers used to borrow money from people within their communities to purchase propertyHistorically, borrowing money from other people to purchase property was common until private financing companies—primarily building and loan associations—stepped in to offer mortgages to buyers. Econ FocusIn 2024, 74% of homebuyers took out a mortgageDebt owed on mortgages made up about 70% of US consumer debt as of 2025. Mortgage collateral ensures the lender isn’t at a complete loss if the borrower defaults. Under most mortgage contracts, the property is considered collateral under the loan. This means that if a borrower doesn’t repay the loan, then the lender can seize their property. BankrateConsequences of a bad credit scoreA bad credit score can lead to spending roughly $100K more on a typical mortgage. Poor scores also prevent you from getting certain jobs, apartments, and more, hindering you from building wealth in the long term. CNBCHawaiians must earn higher annual salaries than anywhere else in the country—roughly $229K—to purchase a typical homeThis map of the US shows the annual income required to purchase a typical three-bedroom home in each state. This is based on a 10% down payment, a 6.65% interest rate on a 30-year fixed mortgage, and a 30% income-to-housing cost threshold, including taxes and insurance, according to recent data from Realtor.com. According to the data, Hawaii is the state where you'd need the highest yearly income. Visual CapitalistIt takes an average of 14 days of work to afford a monthly mortgage in the USThis map of the US shows the number of eight-hour workdays it would take to afford a monthly mortgage payment in each state. Specifically, the calculations are based on median hourly wages in each state, as well as a 30-year mortgage, 5.8% mortgage rate, and a 6% down payment. Visual CapitalistSee the growth of US consumer debtAmericans reached an all-time high debt burden in 2024. Data compiled from The Kaplan Group shows the evolution of auto loans, mortgages, credit card debt, and student loans from 2003 to 2023, and finds that after a brief decline after 2008, the total debt burden grew rapidly. Visual CapitalistThe term ‘mortgage’ was born out of the French word for ‘dead pledge’Borrowing money to buy a house has been a global practice since the Romans in the fifth century BCE. But before the mortgage, there was the “dead pledge,” which labeled the property as “dead” to the borrower until they paid off their loan to the lender. The ConversationThe financial crisis in 2008 had a major impact on many 401(k) plansAmid the 2008 financial crisis, stocks and bonds cratered as the broader market floundered due to the subprime mortgage crisis. Investors with so-called "target-date" funds—which shift allocations based on the maturation of a fund—shared in the slump, with some funds declining by 20% or more just a year or two away from maturation. CNBCThe Federal Reserve's decisions can impact your moneyCar loans, mortgages, business investments—these and more can be drastically impacted by the adjustment of the Federal Reserve’s federal funds rate. Alternatively, savers can earn higher, low-risk yields on their savings when the Fed’s target rate is higher. BankrateDuring COVID-19, the Fed made drastic moves in attempts to shore up the US economy called quantitative easingThe Fed took an aggressive approach to help the US economy during COVID-19 beyond standard monetary levers, including broad purchases of mortgage-backed securities, Treasury securities, and more. Brookings
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