Just because it was the 1935 doesn’t mean that marketing and industry had not been experimenting with genre commonly know today as the infomercial.
Presented by the Household Finance Corporation in 1935, “Financing the American Family” takes a practical look at how the modern man fits into the modern economy, and how micro-financing rigorously supervised by state agencies could buoy families in dire financial straits from despair.
A folksy narrator explains that with the days of living off the land like our forefathers mostly over, a steady paycheck to pay bills, debts, and taxes is the only thing that holds people back from destitution.
If an unexpected loan is needed, without a credit or collateral, a big bank is not likely going to provide a loan.
A man’s good name and self-declarations of trustworthiness wins no sympathy from the banker.
Sitting at night with his wife in the family living room while listening to the radio, by happy coincidence, a program from the Household Finance Corporation comes on the air.
“That’s interesting,” the husband says, “I wonder what this Household Finance Corporation is?”
“It may be the very thing we need,” his wife responds.
As images roll by, the radio announcer explains the evolution finance, concluding that because of limits on interest rate returns, it wasn’t worth it to service small loans.
By the turn of the beginning of the 20th century, 80% of families in America unable to secure smaller loans.
It would take the Russell Sage Foundation’s lobbying efforts to create state regulated financing agencies that would lend to common folks without collateral and interest rates no more that 3.5%.
The loan would be paid back incrementally every month, like rent, and would not be subject to extra fees or penalties.
The amount of these loans would me no more than $300, the equivalent of about $5,500 today.
Proponents of the program, which was endorsed after the year 1916, included Franklin D Roosevelt when he was governor of New York, state leaders of Illinois and Ohio, and even Woodrow Wilson when he was governor of New Jersey.
The program was instituted in 25 states.
Incidentally, one of the biggest providers of these loans is the Household Finance Corporation with over 300,000 micro-loans across the Midwest and Northeast.
After the Household Corp. finance manager vets the couple and determines their level of hygiene and industriousness is satisfactory, the couple are gladly handed the loan from a charming, good-natured loan officer.
Like business providing white papers and educational material to guide prospective leads into doing business with them, the Household Finance Corporation provides a free guide, Stretching the Dollar, which no doubt advocates why the reader should use their service.
As is common today, debtors could request forbearance or pay the loan off in full at anytime to avoid more interest payments.