Evening star., 1934-03-10
MEL0ANSNE
EXHAUSTION WITH
3 BILLION SOUGHT
Many Applications IneIigi-
BILE, but Worthy Demands
Continue.
CORPORATION LISTS
$1,358,0OO COLLECTED
Three-Year Moratorium on Prin-
eipal Payments Granted in
All Cases Where Requested.
BY VINCENT TUTCHING.


Uncle Sans gigantic home mort
gage refinancing agency-the Home
Owners Loan Corporation-rapi1ily
Is approaching the limit of its loan
ing capacity.
This appeared evident today on
the basis of figures given by officials
OF the corporation, which indicate
that the $4,000 100000 in 4 per cent
bonds and the $2OO,0OO,O00 cash as
sets of the organization will be ex-
hauSted before applications now on
hand are disposed OF.
1t was revealed that applications
received to date exceed a total of
$4,000, 100000. OF these, of course,
many-poSSibly a third-will be
thrown out because of ineligibility
under the home owners loan act, or
because reflnancing may be arranged
through existing private agencies, or
for some other reason.
Months More Required.
But of the $4,000, 100000 balance
OF applications, which is growing
steadily under a stream of new re-
quests for aid, many are deserving of
assistance 1t probably will be sew
eral months before the task of set
ting these applications is complete,
so that a decline in this field of
work is not expected by officials of
the corporation for some time yet.
When the business of making loans
ends, which it must by June 13, 1896,
and before if its assets are exhausted,
there will be an appreciable decline
in personnel in the corporation and
corresponding reduction of its pres
ent estimated $4,000, 900 a year over
head.
Under its present policy, the corpo-
ration will draw only upon its origi-
nal assets for the purpose of making
loans, leaving bonds retired and cash
collected unavailable for new loans.
To date the corporation has collected
81 100000 in cash and $4,000 in
bonds, it was learned
In the latter connection it is
pointed out that many loans made
included a three-year moratorium on
principal payments, this being granted
in all cases where asked The corpo-
ration has requested a strengthening
of the law in this respect, so that
some restriction may be exercised
regarding moratoriums.
For Retiring Bonds.
The capital collections, the Federal
Home Loan Bank Board says, are ap-
propriated by resolution of the board
exclusively to retire the bonds, which
are callable by lot at any interest
period, and will be retired as rapidly
as payments on loans accumulate to
seem sufficient to justify a call.
The corporation reports that its
borrowers have been prompt in the
payment Of their Indebtedness, and no
trouble in this respect has so far
come to its attention.
The current report of the Home
Owners Loan Corporation shows that
since beginning operations, it has
placed loans totaling s295 ,307,271 on
104 1894 individual homes in all
States to refund past due mortgages
or to pay taxes or refinance repairs.
OF the total, 99.2 per cent repre-
sented the per cent bonds Of the
corporation.
Only $16,0O0,O0O has been drawn
from the cash assets of the corpo-
ration in making loans. Expenses
of operating the home Office up to
December 81, last, according to its
annual report, totaled S304, SAC. .78.
Field expenses were $4,38O,526 for
the same period-July to December.
There has been an increase in the
number of applications since guar
antee OF the principal of the corpora
ton bonds by the Government ap-
peared certain, Chairman John H.
Fahey said. Careful scrutiny is be-
ing given applications for evidence Of
efforts to refinance through the
H. o. L. c. solely to take advantage
OF a lower interest rate, rather than
to assist a home owner in acute dis
tress. A watchful eye is being kept,
too, for attempts by financing agen-
cies to foreclose only for the purpose
of exchanging real estate notes for
the now more desirable bonds of the
corporation. Such cases, if they are
deemed without merit. are thrown ont