Financing the American Home⁠↗

…I don’t understand the most American of products: the 30-year fixed-rate fully prepayable mortgage. On American streets, the product is everywhere. It makes up around 80% of an $11.3 trillion mortgage market. Yet, with the exception of Denmark, it doesn’t exist anywhere else in the world. Even baseball exists in more countries.

To many, the idea that the US, a beacon of the free market, should support its mortgage market so directly seems odd. The former Governor of the Bank of England, Mervyn King, once remarked: “You Americans are so strange. Most countries have socialised healthcare and a private market in mortgages. You have socialised mortgages and a private market in healthcare.”