Evening star., 1934-06-19
MAY OBTAIN HOME.
AID IN THIRTY DAYS
Owner Allowed to Borrow
Up to So, 1000 for I'm
provements.
BY VINCENT TUTCHING.

BY VINCENT TUTCHING.
Within 80 days the home owner de-
string improvements to his property
through modernization and repair
may obtain up to $4,000 through nor
NAL borrowing channels, with the
help Of the Governments housing
act, one of the last measures to OBJ
tain congressional approval before
adjournment.
This new home loan plan Is de-
signed primarily to make easy the
task of borrowing for lettering homes,
to spur the building of new homes. to
aid in easing the mortgage debt Situ-
alton and to bolster building and loan
associations.
Machinery Less Complicated.
The first aim-to stimulate home
repair and modernization-will lead
the others in taking effect. since the
machinery necessary to put it into
operation is the least complicated to
set up. Preliminary work along the
line has been completed, according to
the National Emergency Council,
which drafted the housing bill, and it
is only a matter now Of establishing
the agencies authorized by the bill be-
fore the benefits of the new system
can be realized.
The provision Of funds for home
reconditioning-the need for which
has been demonstrated during the
last nine weeks since The Stars
81 1000 Better Homes Contest got un-
der ways seen as the means Of
giving stimulus to the property i'm
provement movement in the Capital,
already given a firm foothold as a
consequence of this newspapers cam
paign-
There are two features of the hous-
ing act which will contribute directly
to the field Of home modernization-
the provision for Government guar
antee Of 20 per cent of loans made
for the purpose by private lending
agencies, and the addition Of $780,
100000 to the $200,000,000 fund Of
the Home owners Loan Corporation
earmarked for reconditioning homes
on which it has taken over the mort
cages.
Under the first method the home
owner would go to his bank. trust
company, personal finance company,
building and loan association or other
financial agency to borrow the $4,000
on his note. He might need only
5000, but $4,000 would be the most
he could borrow.
Limited to 20 Per Cent.
The bank or finance company would
then apply to the Federal Housing
Administration, or to that agency
set up by the administration to deal
with this feature Of the act, to have
agency will be limited in these guar
antees to 20 per cent of the loans,
with its responsibility limited to q
total of s2Oo,oOo.o0o.
BY guaranteeing 20 per cent Of
loans. it is not necessarily meant that
the Government will be responsible
for but $400 of each $4,000 loan.
Rather, it will stand good for 20 per
cent of the total loans made by sin
gle agency, so that it would be in a
position to make good one loan out
of every five.
Terms of the loans the Govern
ment will insure will be left to the
decision of the administration, but it
is believed the equal installment
method Of consumer credit, with
monthly payments as low as $40, will
be utilized. officials have indicated
standard terms probably will be in
terest at per cent, with per cent
added for the insurance fund from
which losses will be made good.
The period Of the loan, probably will
not exceed five years. The Govern
ment will insure this type Of loans
made up to January l. 1885.
BY adding s10o ,0oo, 900 to the re-
sources of the Home Owners Loan
Corporation for home reconditioning,
the Congress has increased this all
important fund to 100000, 900.
Limited to Actual Distress.
Loans from this credit reservoir al
ready are being applied for through
the H. o. L.. c. Offices in each State
and the District Of Columbia. They
are limited, however, to home owners
in actual distress, whose properties
have been or are about to be financed
through the corporation. The total
of the mortgage and the recondition-
ing loan is not permitted to exceed
80 per cent of the appraised value Of
the property, and only homes valued
at less than $40, 1000 are eligible.
Home betterment projects under
taken under either of these methods
are eligible for participation in the
$1,000 Better Homes Contest now be-
ing conducted throughout the metro
politan area by The Star.
For homes valued at $4,000 and
less, the following awards will be
made for home improvements: First
prize, $3.50; second prize, $1o0; third
prize. $50, and four honorable mem
ton prizes Of $25 each. For homes
valued at more than $4,000 similar
list Of awards will be given.
The Board Of Trade Is offering a
special 500 prize for the outstanding
landscaping improvement completed
during the period Of the contest,
which ends September 15
Citizens associations In the Dis
trict and nearby counties are coop
Grating nearly 100 per cent with The