Finance Firms

          Provide loans directly to consumers and businesses, as well as help borrowers obtain mortgage loans on real property. Some consumer-focused finance companies finance installment loan purchase of automobiles and other durable goods, while others provide small loans to individuals and households. Businesses that are unable to obtain financing from commercial banks often turn to finance companies that make commercial or business loans. Mortgage banking firms, sometimes just called mortgage companies, "originate" real state mortgages by bringing together borrowers and institutional investors. However, finance organizations usually don't perform financial intermediation roles since they obtain their own financing from other financial institutions rather than from individual savers.
          Few of today's financial institutions existed during the American colonial period. Only commercial banks and insurance companies (life and property) can be traced back prior to 1800. Savings banks S&Ls began developing during the early 1800s. Investment banking firms (and organized securities exchanges) also can be traced back to the first half of the 1800s. No new major financial intermediaries evolved during the last half of the nineteenth century. Credit unions, pension funds, mutual funds, and finance companies began during the early part of the twentieth century. Thus, throughout much of the 1900s and into the 21st century, emphasis has been on redefining and restructuring existing financial institutions rather than introducing new ones.