Evening star., 1934-08-08
BY JAMES A. MoFFETT,

Copyright, 1884. py tne ASSoClabeu fIeSs.
The purpose Of this series is to ex-
plain the modernization program be-
ing launched by the Federal Housing
Administration. the object Of which
is to encourage-where needed-the
widespread repairing and recondi-
tioning of residential and commercial
properties.
Under the national housing act. the
Federal Housing Administration is
also authorized to set up machinery
to insure long-term amortized home
mortgages, but this part of our pro-
gram will not be launched until
later date.
First of all, let me explain that the
Government will not make loans to
individuals or corporations for the
improvement of their properties.
Banks to Make Loans.
The loans will be made by COM
mercial and industrial banks, building
and loan associations, savings banks
and other lending institutions, and
the Governments part will be to
insure the lenders against 100 per
cent of all loss. provided the total
of such loss does not exceed 20 per
cent of the total volume of such
credits advanced. Where loans are
obtained for the specific purpose of
repairing property, the lending insti-
tuition will not require collateral. ex-
cepting in some cases where the State
law requires the particular institu-
ton to loan only on mortgage.
The great bulk of financial ad-
vances to be made under this plan
will be in the form of character
loans" The borrower will get his
loan solely on the basis of his ability
to repay and his general reputation
for honesty and fair dealing, with
out indorsers or comakers OF the
note.
Another point I desire to empha-
size is that the Federal Housing Ad-
ministration expects to resort neither
to regimentation nor bally-hoo. We
are not going to put pressure on
property owners to borrow for the
purpose of making this campaign a
success.
Our only thought is that where
properties are in need Of repair and
the owners are in position to repay
the costs of such repairs out OF regu-
lar income, we shall offer practlcal
cooperation in securing the funds
needed.
We want only such loans made as
shall be. first of all. of definite value
to the property owners themselves
Help for Entire Nation.
1t will be readily recognized that
the composite values of this under
taking will be very great. The i'm
provement of individual properties
will help the entire community in
which they are located and this IN
turn will help the entire Nation.
These processes will stimulate de-
mand for innumerable products OF
the factory. mine and field. They
will increase employment, enhance
real estate values and elevate the
standard Of living by making avail
able a greater number of home con-
Veniences.
To sum it briefly, we of the Federal
Housing Administration are hopeful
that this program will set in motion
forces that will be of timely and vital
value to the Nation. both in speeding
recovery and in attaining permanent
economic and social objectives.
1 have been informed by those who
have made close studies OF the nous
ing situation that there are about
Is 500 900 buildings in this country
in need Of repairs, 100000 OF which
need structural changes.
The loans to be made to property
owners for all kinds of repairs ana
improvements to all kinds OF prop
erty will be limited to a maximum OF
50 900 and no loan of less than 500
will be made.
The loan is to be repaid with in
terest on a monthly payment basis.
In the case of farmers, repayment
will be made on dates crops are sold.
First Step Explained.
If you have decided that you want
loan for the purpose of improving
your property, your first step should
be TO see a contractor, or building
supply dealer. or architect, and as
certain the exact cost of the work
that is to be done.
Then go to your bank or some
other financial institution in your
community approved by this admin
istration and apply for loan for the
required amount; or your contractor
or building supply dealer may take
your loan application direct.
The bank, or other institution, will
then make an investigation. If 1t
finds that the improvement you wish
TO make is well advised. and that you
are in q position to repay the loan,