The Brookings register. [volume] (Brookings, Brookings County, S.D.) 1903-1971, 1920-04-29
HOME F|NANC|NG(
PLAN A SUCCESS
HOW MAN WITH LIMITED MEANS
IE ENABLED TO BUILD A
HOME FOR HIMSELF
OuTGTONTH Of BIG NEED FOR HOUSING
Initial Payment on Homes as Low
AS Ten Per Cent, Then One
Per Cent a Month.

\ married man with a family had
been renting his home for years when
suddenly the place was sold and he
was obliged to move. After that he
moved several times until at last he
was left with no place to go and con
templated leaving town He was
asked, why don't you build a house,"
He gave the same reply that hundreds
Of other renters have given, Il haven't
got enough capital"
For many years that argument has
been unanswerable but a new and note
worthy development, growing out OF
tremendous need for housing and the
inadequacy of the conventional home
financing methods of the past has sat
isfactorily solved this problem in
many cities These new plans OF
schemes that have been worked out
by some of the foremost business men
and economists of the country may be
grouped under the general head of
housing" or "home financing cor
porations. 1t is their purpose to give
to the average man of limited means
who desires to build, assistance beyond
ordinary banking service. 1t has
proven superior to the second mort
gage plan and the building and loan
association plans.
In scores of cities and towns these
housing corporations are now in SUI
cessful operation. The capitalization
ranges from, in the case of the larger
corporations, several millions of dol
lars each, down to as little as 100000,
the latter usually in comparatively
small centers where housing corpora
tions have been formed as adjuncts TO
own Your Home" campaigns having
as their aim the betterment of the
community and the providing of homes
needed by its citizens of all classes,
rather than as strictly industrial hous
ing schemes
These business corporations are not,
primarily at least, for profit; in fact,
most of them are quasi-public institu-
tions, promoted and organized to meet
an acute public need. There are vari
Gus types and kinds of organizations
and societies in the many cities en-
gagged under different plans in reliev-
ing the housing situation by encourag-
ing and aiding home building
1t will perhaps be of interest to note
briefly some of the outstanding fea-
lures of few of these corporations.
A housing proposition that has AT
tracted considerable attention and
which up to this time has resulted III
the erection Of good number of
houses is that known as the Detroit
Plan" which functions through the
House Financing Corporation of De-
troit. incorporated under the laws OF
the state with capital of $4,000 ,000. (
The corporation has twenty-seven di-
rectors, representing the manufacur
ing. industrial and banking interests
Of the city, who meet monthly. The
active management is vested in an eX-
ecutiye committee, of six members,
evolving out of NE directorate, which
meets weekly. The active officers are
the president, who is also general man
ager. and the vice-president, who is
also treasurer.
The necessary subscriptions to the
cap tai stock were secured at a series
Of luncheon meetings to which Sc
lected list of prominent manufactur-
ers. business and financial men had
been invited. They were asked to
subscribe in proportion to the number
Of their employees, as follows: The
first 500, $25 an employe; 500 to 1000,
500 an employe; 1000 to 5000, SIS an
employe; 5000 to 10000, $3.50 an en-
plOye: over 10000, SO an employe.
No loans are granted unless the cor
poratiOn controls or supervises the
building operation. For the present,
loans are confined to an amount not
exceeding $4,000 for single residence.
All interest charges are at the rate of
six per cent The corporation operates
under three plans, covering three gen.
eral classes of business, namely. the
banking plan, the operation plan, and
the contractors financing plan.
Under the banking plan the corpora
ton aims to take care of applicants
who either own their lots or who have
in mind the purchase of lots in spe-
cifc localities. 1t loans up to about
80 per cent of the total amount in
volved in the transaction. The bal
ance is paid in monthly installments of
such amount as to complete the trans
action within one hundred months.
Under the operation plan the cor
poration erects houses in groups OF
from a dozen to one hundred, which
are sold to applicants under the gen
eral terms outlined above. The "con-
lCnntinned ON Page Col. 81