What politician would kill the 30-year fixed-rate mortgage?

The second to last chapter of Shaky Ground: The Strange Saga of the U.S. Mortgage Giants includes this summary of the American housing industry:

But there is widespread agreement among policy makers on at least this element of investors’ argument, which is that you cannot keep a cheap, long-term, fixed-rate mortgage available to the wide swath of Americans through big economic ups and downs without some sort of government backstop. There is a reason no other country has such a product. For all the supposed ideological purity in today’s Washington, no politician wants to be responsible for the loss of something Americans have come to see as a right. Indeed, despite Alan Greenspan’s admonition years ago that many Americans would do better with adjustable-rate mortgages, in November 2014 a stunning 87 percent of Americans who took out a mortgage to buy a house chose a 30-year fixed-rate mortgage, according to data from the Urban Institute.

As the rest of the book argues, the 30-year fixed-rate mortgage today the result of particular arrangements involving Fannie Mae and Freddie Mac. Americans after World War II may have thought they were after owning a single-family home but less attention was paid to what was undergirding all of this: a particular financial instrument – the 30-year fixed-rate mortgage – that made some people a lot of money and helped dictate other areas of policy and social life.

3 thoughts on “What politician would kill the 30-year fixed-rate mortgage?

  1. Pingback: Updating the last few years of (private sector) history of Chicago’s public housing | Legally Sociable

  2. Pingback: Closing on a house feels like… | Legally Sociable

  3. Pingback: Why Americans love suburbs #3: race and exclusion | Legally Sociable

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s