In the early days of the mortgage, interest rates were pretty high (sometimes up to 15% or 20%), and the loans would often culminate with a “balloon payment,” similar in size to today’s downpayment. This made paying off a mortgage an even more momentous occasion, and homeowners would celebrate by throwing a big party and burning their mortgage documents.
Guests would bring gifts to help commemorate the home being owned free and clear, and this tradition has since evolved into what we now know as the housewarming party.
