Evening star., 1933-11-30

FAHEY.
ing on home owners as condition OF
stopping foreclosure Is that the mort
gagor shall give notes or a second mort
gage for an amount equal to the differ
ence between what the mortgage claims
is the value of the bonds and the
amount of the mortgage. This is an
absolutely unfair exaction and the cor
poration will not countenance any trans
action Of this sort.
Mortgage Gets His Due.
The worth of a sound bond is not to
be measured by the price at which 1t
may temporarily be sold in an unstable
market. Hundreds of the very best
bonds to be found anywhere are fire.
quent1y quoted at prices which have no
sane relation to their intrinsic value
because of the effects of unreasoning
fear and uncontrolled speculation. In
most cases today the mortgagor who
forces the sale of home cannot get the
fair value of his mortgage unless he
takes from the home owner an equity
which honestly belongs to the owner.
When the mortgage receives for the
full and fair value Of his mortgage
ing his interest at fair rate. and full
payment OF principal when due, he is
getting all he Is entitled to, and he has
Many schemes are brought to the at
tention of our board from day to day
by which mortgages who appear to
have no sense Of justice and fairness
attempt to get from home owners either
cash or promises to make payments be-
he Of he ocyo
which it is proposed to exchange for
the corporation bonds. No home owner
should submit to any Of these exactions.
He should be ready to carry cheerfully
the burden of the reasonable indebted
ness he owes, but he should not be in
posed upon by extra payments beyond
the fair amount Of the debt.
Home owners should understand also
that they are not called upon to pay
any commissions or fees to any one
connected with this corporation or
claiming to represent 1t, in order to
have their applications given proper
attention. The corporation charges no
fees against the home owner except the
legitimate cost of proper investigation,
title examination and appraisal. These
charges are covered in the amount of
the mortgage, and the home owner is
not called upon to pay cash fees to any
one connected with this corporation.
Beware OF SWindIers.
We have received reports from time
to time that individuals represent to
home owners that they can arrange to
secure a loan for them from the cor
poration for commission. These men
are frauds and are acting in violation
of the law. The corporation will prose-
cute such persons in all cases where
it is able to secure proper evidence Of
their illegal acts The privileges &C
corded by the home loan act are open
| to all home owners whose cases come
within the provisions of the act, as I
have attempted to explain them. We
recognize no distinctions between legit1-
mate applicants and no influence, di-
rect or indirect. is necessary to secure
the consideration to which any eligible
| applicant is entitled:
| The law permits the making OF cash
loans under certain circumstances. Such
cash loans, however, cannot be in ex-
cess of so per cent Of the fair appraised
value of the property and in some cases
40 per cent. There are many cases In
which home owners whose equity Is
very large are not able to borrow any,
thing on their homes under present
conditions. In such instances, the cor
poration is able to be of substantial
help It should be realized, however
that the number Of cash loans which
NAV be made are comparatively small
since it Is generally possible for the
home owners to borrow as much as Al
per cent of the valuation on first
mortgage from one Of the various
mortgage lending institutions. The
corporation has been receiving some re.
ports of the activities of spectators
who are attempting to buy bonds OF the
corporation from individual mortgages
who have obtained them in exchange
for mortgages. They make unwarranteo
| cash offers for the bonds and try TO IN
duce the holders to part with them who
do not fully understand their value.
Points to Libery Bonds.
It Is well to remember that during
the war millions of people were en-
couraged to become investors, to theil
! own great advantage, through the pur-
chase of the greatest securities in the
world-Liberty bonds. Unfortunately
TOO many OF them were later persuaded
by designing promoters pt s., to Part part ths;1 T,sn
savings in unsound stocks and worth
less pieces Of paper with resulting losse:
running into hundreds Of millions Of
dollars. The people of this country
should never forget that bitter expert
ence. They should hold tenaciouSly tc
the bonds of their Government and
| those for the safety of which it is re-
sponsible The Home Owners Loan
Corporation is often criticized because
its work seems to be slow. Doubtless
| some of this criticism is warranted, but
| it is fair to consider that this is the
most far-reaching undertaking of the
kind ever attempted and 1t Is sur
rounded by many complications. In a
comparatively few weeks great or.
ganization had to be created composed
| Of men who, with few exceptions, had
never before worked together. Mistakes
were inevitable and of course many
were found unequal to the task and
had to be changed. Over 100000 ap-
plications from anxious home owners
quickly overwhelmed the offices Of the
corporation and tons of mail engulfed
| its employees as soon as our Offices were
open. It takes time to investigate such
flood of demands, sort out those re-
curing immediate attention and ar
range for the necessary appraisals and
title examinations which must be care
fully made In order to be sure that nc
one Is treated unjustly. Up to this
week loans to total Of over 81 ,900,-
600 900 have been applied for; 100000
loans, amounting to over $450, ,000, 900
have been approved, subject only to the
| necessary final checking of values and
titles. In fairly short time all these
loans should be closed. Already over
$4,000 loans have been cleared up and
bonds issued in exchange for the mort
! gages The loans amount u s35 5,000,-
900 and the pace is quick erdng every
week. Every competent appraiser and