Evening star., 1935-04-13
HOME LOANS SHOW
MARKED INCREASE.
Building and Loan League
Reports So Per Cent Gain
in First Quarter.

Volume of loans greater than at
any like season in the past three years
was made by the building and loan
associations during the first quarter
Of 1885, reports to the United States
Building and Loan League from i'm
portant States in the industry indi-
cate. In a fourth of the reporting
States the loans this year mount
higher than in any first quarter for
four years.
Comparing the reporting States for
1884 and 1885 the national organiza-
tion finds SO per cent increase in
volume of loans and a II per cent
increase in the number of families
served. thus showing that the size
of the average loan has decreased
slightly. The growing importance of
modernization and repair loans is the
chief reason for the smaller amounts
per family being disbursed
l. Friedlander, Houston, Tex. preSi-
dent of the league. estimates. on basis
of the reporting States, that between
$75,000.000 and $50 900 600 was placed
in loans by the associations HI Janu-
ary and February. usually off-months
rejecting this year the influence of
general interest in the hore which
have been emarating from the Fed
eral Housing Administration.
Insurance Features Gain.
Friedlander pointed out that to date
only a nominal number of the build
ing and loan advances in 1885 have
been made with either tht title I or
the title II insurance features set up
for added mortgage security under
the Federal Housing Administration
but said that from now on freer
use Of both plans will undoubtedly be
possible. widening the reach Of build
ing and loan services.
With the liberalizations of title !
and title II, regulations already in
effect. there should be an increasing
number Of building and loan associa-
ton advances which do take advan-
tage Of this added security for the
loan." Friedlander pointed out. LAS a
rule, the customer with normal Sc
curity to offer desiring a to IL or
IS year loan can be served just as
economically and many times more
so by the building and loan associa-
ton time tested loan plan as he can
by the mutually insured mortgage
plan. There are. however. marginal
types of loans which can be supplied
by building and loan associations as
long as the insurance feature Is there
to give the investors in the associa-
tion protection against the added risk
Of such borrowers. These types in
clude the loan which is an abnormally
high per cent of the property value,
and that type wherein the borrower
cannot make high enough monthly
payments to amortize the debt in less
than Is to 20 years. Consequently the
associations which do use the new
plan will offer their own and this
adaptation Of it side by side.
5000 in Association.
Associations which are members
Of the Federal Home Loan Bank Sys-
tenn, now numbering about 3,100. are
automatically approved mortgages
upon receipt of their applications by
the Housing Administration. All 9TH
ers have been urged by the League
Committee on title II to get them
selves in readiness to offer this type
of loan when the customer desires
1t and the conditions call for it.
The record of loans made this
year on our own plan and the future
prospects of lending to be done by
offering this plan and the insured
mortgage side by side should swiftly
reassure Government officials, realtors,
property owners and business econ
onists that private capital Is in the
field and doing an increasing volume
Of business"