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Again, this type of arrangement gave great security to the lender. The borrower’s income was regarded as security for the ongoing interest payments, while the property itself served as security for the principal. From the borrower’s viewpoint, the “interest only” repayment plan minimized the cash outlays and allowed for the establishment of a savings account to build toward the eventual repayment of the principal. Periods of stable interest rates, low inflation and stable property values resulted in these interest only mortgage loans being generally regarded as safe and satisfactory investments. The economic collapse of the North American economy during the late 1920s and early 1930s changed the perception of these interest-only mortgage loans. During the depression, many lenders found themselves with loans made to individuals who now had no income and whose property was worth considerably less than the amount the borrower owed. It was during this time, many lenders realized the concept of principal risk associated with interest only loans. They were now at the end of the term of the loan, the full amount of the principal was still outstanding, and this amount was more than the value of the property. The risk they faced - the purchaser might refuse to pay the principal amount, and the lender would be left with a property worth less than the principal. The mortgage market responded to this newly understood risk by creating what we now think of as a mortgage. The most common form of these repayment plans was the long-term, fully amortized mortgage. In a fully amortized mortgage, each payment monthly payment made by a borrower, is the same for the life of the mortgage and is comprised of interest due plus a partial repayment of principal. At maturity, rather than the full amount of principal being due, the full amount of principal has already been fully repaid during the term. This form of repayment was the rule in mortgage lending, particularly in the residential sector, from the end of the depression to the early 1970s.