Evening star., 1932-02-13

klCdQCu NY OCildUOl w dUSOll VI lllOl
The National Association of Real
Estate Boards and the United States
Building and Loan League, urging pas
sage of the measure, both have set up
temporary national headquarters" in
Washington for the duration of the
congressional hearings and meanwhile
have sent out to their members over
the country educational reports spon-
soring the Home Loan Bank plan.
Opposition Explained.
The Mortgage Bankers Association
of America, which registered opposition
to the measure at the initial Senate
Committee hearings, also has made
public statement issued from Wash
ington giving its reason for contesting
the plan.
The measure, introduced in the Sen
ate by Senator Watson and in the
House by Representative Luce of Mas
sachuSettS, provides for establishment of
II banks scattered throughout the
country whose sole business would be to
discount first mortgages on dwellings
held by building and loan associations,
banks. insurance companies and other
home financing Institutions
Herewith are reported the positions
taken by the SpokeSmen for the three
national business organizations on the
proposed plan.
L. T. Stevenson, Pittsburgh. president
of the National Association of Real
Estate Boards, reported that witnesses
called by his organization would bring
out the following six points in support
of the banking plan:
1First, that the Home Loan banks are
desperately needed to meet the great
ann growing problem of home mortgage
ren3Wals.
"6econd, that. contrary to general
opinion. the country is not overbuilt in
homes and that the proposed system
will be required very shortly to furnish
funds for new construction. there being
practically no mortgage funds available
for this purpose in hundreds of cities.
Stability Need Cited.
Third. that the banks are needed to
bring a stability that has never existed
to the construction and allied businesses
whose financing has depended in the
past en- local conditions that should not
affect home ownership
to bring long-term financing to the
home owner. which will Immediately
take thousands of people out of the
renting class. The bills provide a
premium for discounting long-term
mortgages as means of encouraging
mortgages of long duration. This also
will encourage home ownership
Fifth, that the banks, by providing
q constant source of money for this
purpose, will lower interest rates.
which will give another tremendous
impetus to home ownership. It has
been estimated that a saving of l per
cent in interest rate on a home mort
gage would make a saving of Is per
cent in the ultimate cost to the home
buyer.
In addition to the above, the banks
are urgently needed if the Presidents
program on boarding is to be carried
out Building and loan associations and
banks could apply to the Home Loan
banks for advances on their sound first
mortgages and thus release the savings
of large sums which would be restored
to hundreds of communities
Agency Called Sound.
As the representative of the building
and loan field, William E. Best Pitts
burgh, president of the United States
Building and Loan League, this week
issued this statement
The agency proposed in the Home
Loan Bank bill is sound, conservative
and built upon existing institutions
which are subject to inspection and
regulation by the States. 1t is nom
1nflationary and is planned to give
financial support to existing home
financing, thrift or savings institutions.
1t will fill an immediate need as finan-
cial institutions have millions of dollars
Of preferred first mortgages on homes
upon which they cannot raise funds
sufficient to meet the demand for re-
financing existing mortgages which
have been called, come due or are being
Continued on Second Page)