Evening star., 1935-08-17
NEW CREDIT PLAN
TO Be PERMANENT
Pacific Coast Welcomes
Chance to Borrow for
Modernizing.

The modernization credit plan has
won permanent place in the finan-
cial scheme of the Pacific Coast, ac-
cording to Alfred B. Swinerton, and
will continue to be available to people
desiring funds for property rehabili-
tation even after the Federal Housing
Administrations authority to insure
such character loans has expired next
April.
Swinerton, Pacific Coast regional di-
rector of the Housing Administration
paid an informal visit to the Wash
ington Office this week and gave a
summary of the activities of the West
Coast financial institutions under
titles l and of the national housing
act.
Insured Credit Plan.
Insured modernization credit. he
explained, is an instrument designed
to permit borrowers to obtain funds
from private institutions for needed
repairs to real property without in
dorsement or collateral and to repay
these loans in convenient installments
over periods as long as five years. 1t
Is form of character loan as it
applies to residence property and
smaller business and commercial
structures where the limit for any one
loan is set at $4,000. For certain other
properties such as large income pro-
ducing buildings, manufacturing and
industrial plants, including the pur-
chase and installation of machinery
and equipment the limit is set at
$50,00O. Collateral may be required
for this type of credit, at the lenders
discretion.
Under the plan the Federal Hous-
ing Administration insures the lending
institutions against possible loss up to
20 per cent of the total volume of
such credit extended.
Leading in Insurance.
The financial institutions in the re-
elon under Mr.. Swinerton's director
ship, comprising California. Idaho,
Nevada, Washington, Oregon and Ari-
Zona, lead those in all other regions
IN insurance of loans for moderniza-
tlon purposes as well as being promi-
nent In the acceptance of the mutual
mortgage insurance plan tor new resi-
oence construction and the refinanc-
ing of existing dwellings.
THE success encountered under the
modernization credit plan has been
due" Swinerton said, ito the highly
intensified cooperation of the lend
ing institutions and the intelligent
direction that they used in furthering
the modernization movement. In place
OF merely passing on applications for
insured credit as they came into the
institution, banks in the Pacific Coast
territory have busted themselves with
encouraging and educating their de-
poSitors engaged in building and al
lied trades to go out and get busi-
ness, assuring them that the credit
would be forthcoming.
I'm the larger centers on the Coast
few skilled mechanics are unemployed.
In the leSS-populouS towns and small
er cities no skilled help whatever re-
mains idle"
Exceptional Activity.
The volume of mortgages accepted
for insurance showed exceptional ac-
tlVity in new residence construction,
the average being slightly better than
al per cent. Despite the fact that
the maximum interest rate on mort
cages insured by the Federal Housing
Administration has been set at 5 per
cent, and the old-home mortgage rate
on the West Coast ranged from a
low of per cent in San Francisco
to as high as per cent in other
localities within the region, a large
volume of mortgages has been accept
ed for insurance. They are now being
subjected to appraisal and underwrit-
ing Investigations by the Federal Hous-
ing Administration to determine their
qualification for insurance.