Evening star., 1934-11-02
ROOSEVELT SETS
so INTEREST RATE
ON HOME LOANS
OverruIes Opinion of Admin
istrator Moffett in Launch
ing Huge Program.
$4,000, 900, 900 TOTAL
IN PROJECTS PREDICTED
President Insists Cheap Money
Must Be Offered as Plans
Are Outlined.
BY the Associated Press.

President Roosevelt, oVerrulng MS
housing administrator on interest
rates to aid the great mass OF our
people launched today a gigantic
home building campaign which may
aim at $4,000, ,000.O 900 construction
boom during the next 10 years.
Setting basic maximum" interest
rate of per cent for the whole Ma
ton. the administration announced
regulations under which loans for
home building will be insured up to
80 per cent of the appraised value.
Moffctt Asked Per Cent.
James A. Moffett former Standard
Oil executive whom the President
drafted to be his housing admins
traitor. thought the interest should be
per cent in some sections, but the
President disagreed.
Il am firm in the conviction" he
told Moffett in an open letter. that
every practical attempt at lowering
the cost of homes to the great mass
of our people is worthy of our best
efforts 1t is time to make these lower
interest rates apply to every part OF
the country"
Besides aiming to encourage new
home building. this second phase of
the Nation wide drive under the hous-
ing act provides for mutual insurance
of mortgages on existing dwellings
up to 80 per cent of appraised value,
and for the organization Of mortgage
loan companies to sell securities based
on mortgages.
Besides the 5 per cent interest.
there will be a service charge of one
half of l per cent yearly on new
homes, as well as an insurance pre-
MUM of the same amount per year.
To the basic maximum for refnanc-
ing houses already existing must be
added per cent year for insurance
and, in case there is change of
lender in the transaction. a service
charge of one-half of l per cent.
No Loans by Government.
The first mortgages are expected to
be approved by the Housing Admin
istration within a day or two. Loans
will be made by banks and other pri-
vate agencies, none by the Govern
ment.
The Roosevelt administration an
nounced no total sum which it hoped
would pour out in this new effort to
stimulate the durable goods" indus
tries. However. Henry I. Hartman,
president of the Chamber of Com
merce of the United States, suggested
in a speech last night that the hous-
ing act could be used to stimulate
SIS 900 100000 worth of home build
ing within decade.
Speaking before the National Paint,
Varnish and Lacquer Association con-
vention at the Mayflower Hotel, Har-
riman stressed particularly the build
ing of suburban or country homes
for industrial workers on fairly large
plots so they could raise much of
their own food and thus become
partly independent of wages" 1t
has been noted that Harriman's ideas
In this respect closely resemble those
of the Roosevelt administration.
Mass Production Seen.
Declaring such homes could be built
by mass production for $4,000 or less,
he told the association:
With an accumulated shortage OF
housing in this country now, and with
lIlt 40 "
slum clearance and to more adequate
housing I believe a housing program
that would contemplate the construc-
ton of even as many as 750, 900 houses
a year for the next 10 years is not
impossible of attainment
He calculated that each new home
would mean the equivalent of the
employment of two men for a whole
year. Thus, if 900 houses year
were built 1t would mean putting
100000 persons back to work.
Hartman emphasized that the
work should be done by private in
dustry. He said:
THE Government itself should &c
no further than to be responsible for
the general plan, and for that as
sistance which will permit our build
ers, our material dealers and our
manufacturers to go forward in per-
forming their own functions and thus
increase the employment they can
give to the people who are now out
of work.
THE Government should point the
way and set the conditions of its
material aid. but it should not itself
take over the huge tasks either OF
planning or of execution. The housing
act would seem to afford an existing
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