Evening star., 1932-05-14
HOOVER CITES NEED |
IT0 FINANCE HONEST
President Appeals for Loan
I Banks in Statement Made
+ Through Magazine.

: An appeal for enactment of legisla-
Zion creating a system of Federal home
fnan banks for the rediScount OF mort
cages on dwellings is made by Pres1-
dent Hoover in statement published
an the Ladies Home Journal.
Z ITO possess ones own home, however
small, is the hope of every family IN
bur country" the President is quoted.
SThat is the American ideal born OF
hn exquisite sentiment, nurtured by
long national tradition, and proved
right by its innumerable practical ao-
Nantages.
MANY things have conspired to frus-
krate this hope to lesser accomplish
ment than the welfare of the Nation
demands. Nevertheless, we can
and should now do better"
Tells of Proposed Law.
( Pointing out that the financing OF
home ownership has not kept pace with
improvements in design" President
Hoover's statement tells Of the proposed
law providing for setting up Federal
system of home loan mortgage discount
banks, to which may belong building
and loan associations, savings banks;
deposit banks, farm loan banks ana
similar institutions.
: 1.-The broad purpose" President Hoover
continues, "is to provide for the nome
owner a comparable background OF
Stable credit with that we already nave
provided nationally for the business
man through the Federal Reserve oanKs
and for the farmer through the Farm
Loan banks and the lntermeoiaGe
credit banks. The plan and method is
not to engage the new institutions IN
the business of providing direct loans,
but to give impulse, security ana salety
and lower interest rates to the aIreaoy
existing institutions - especially the
mutual institutions-in order that tney
NAV extend the fullest measures OF
credit to Would-be home owners.
: The President considers the creation
nf this system Immediately desirable
because of certain emergency phases
uointing to the great numbers OF peo-
nle who are in danger OF losing tneH
homes because of the olfnculties IN oD-
tanning renewal for their Snort-term
He indicated he further believes such
q system would stimulate construction
and. consequently, industry and employ
snent in the thousands OF communities
where the need and demand 1or new
homes is at present hampered by lack
pf credit.
Hopes for Enactment.
.This plan has found sympathic sup
hort and Endorsement of thousands OF
savings banks, building and loan asso-
Citations, country bankers and, above
all. from would-be home owners, the
president concludes, voicing the hope
that the proposed measure would soon
be enacted into law.
C. C. Sherlock, writing in the Journal,
mas proposed four points for improving
the home financing system:
That the financing coverage be ex-
tended by creation of the home loan
banking system, through home financ-
ing acceptance corporations and through
supplementary local financing groups
sponsored by the building industry and
local finance.
That simpler mortgage procedure be
adopted, through adoption Of a uni
form mortgage act, through long-term
loans up to Is years and amortized
monthly, and through the merging Of
home loans into one instrument.
demanded, through adoption Of q ma
tional standard of appraisal, through
rigid contIol of building specifications
and through improved standards OF in
Spection and supervision.
That sound credit principles be fol-
lowed, with adoption of the principle
that the hcme purchaser should have
saved Is to 25 per cent Of the total
purchase price. and that the purchaser
should not obligate himself to carry
total monthly charges of more than IS
per cent OF his income.