The Washington times., 1935-01-12
ALL COUNTIES
WILL HAVE
SERVICE

1t Is the intention Of the Fed
eral Housing Administration to
extend the benefits Of the Mutual
Mortgage Insurance under Title II
Of the National Housing Act to
every urban community, and in
particular to every county seat in
the United States, 1t was learned
from Federal Housing officials.
Under the regulations, lending
institution authorized to extend
mortgage loans insured by the
Federal Housing Administration
must be located in an urban
community which has a trading
area embracing contiguous
population of not less than 5000"
There are many counties in the
United States which have no
towns Of 5000 census population,
including county seats.
Will o. X. Others
Notwithstanding the initial limh
tations in the Federal Housing Adj
ministration'S regulations cover.
ing mutual mortgage insurance,
it is the intention of the Admins
tration that no urban communities
in general, and in particular no
county, be denied the benefits Of
Title II of the National Housing
Act.
1t was stated officially that the
administrator will approve, upon
application, at least one bank if
responsible and able to service
the mortgage properly" in each
county seat, regardless Of present
requirements as to capitalization
and population.
The regulations do not restrict
approved lending institutions from
offering for insurance eligible
mortgages on property located in
any area where they are otherwise
permitted by law to lend.
May Act as Brokers
Member banks and other lend.
ing institutions not eligible b.
cause of the requirements as to
capital or domicile may neverthe-
less function as correspondents,
brokers or agents for the lending
institutions which are approved
mortgages.
Under the original regulations,
an institution applying for ap-
proval as mortgage Qender) had
to be located in a town or city
with a population of not less than
5000 and had to have a paid-in
capital Of not less than 100000.
Under the present general regu-
lations, the lending institution
must have combined unimpaired
capital and surplus of not less
than 100000, of which at least
$4,000 is unimpaired capital. This
means that if an institution has
only $5O,000 of unimpaired capital,
it must have at least $50 900 of un.
impaired surplus. However, if its
unimpaired capital amounts to
$4,000, for example. an unim.
paired surplus of $4,000 would
suffice.
S0 rec FlXeQ
Appraisal fees to cover cost of
appraisal by the Federal Housing
Administration of the property
covered by a mortgage to be in
sured are fixed at the rate of $3
per thousand dollars of the prin-
cipal amount of the mortgage. II
an application is refused without
an appraisal being made by this
Administration, the fee will be re-
turned to the applicant.
Under the original regulations,
the lending institution had to bG
under the supervision of the gov.
ernmental agency from which it's
charter powers were derived.
Now the institution has merely
to be subject to supervision sat.
lsfactory to the Administration,
by some governmental agency.
All national mortgage associa.
tionS which may be created under
the National Housing Act ara
automatically approved by the
Federal Housing Administration
as mortgages.
The Reconstruction Financa
Corporation, the Federal Home
Loan Banks and similar govern
mental agencies are approved as
mortgages.