, 1935-05-30
Home RELIEF
IS EXPLAINED
New Applications Will Be
Received Under Old
Eligibilities

Dealing with the amendment 70
the Home Owners Loan Act, signed
Tuesday by President Roosevelt.
which permits the Home Owners
Loan Corporation for a period Of 80
days tc accept new loan applications.
John II. Fahey, chairman Of the
corporation, Wednesday issued the
following statement. emphasizing
that such applications win be &C
cepted only from home owners who
are clearly in distress, and r
threatened with the loss Of their
homes through foreclosure:
The same tests Of eligibility Of
Hole applicants which have applied
in the past will in general continue
in full force under this new legisla-
ton. The corporation intends to
make every effort to assist home
owners who are in genuine finan-
cial difficulty. but II win be forced
70 reject every application which Is
not clearly eligible.
mo home owner should apply for
a loan until he has first made GER
tain that his application will be ELI
gible under the corporations re-
st.ictions. He should realize that the
rejection of an ineligible applica-
tion, on grounds Of deliberate de-
fault on existing debts, Is likely
to cause the home owner the loss Of
his property. because Of the unwil-
lingneSs Of his present mortgage 70
carry the loan following such de-
fault.
Largely as a result OF than
the two and one-half billion dollars
In bonds already disbursed TO them
by the Home Owners Loan Corpora
ton, lending institutions are In a far
stronger position today than they
were a year ago. They are well able
to recast and carry reasonably sound
mortgage loans, instead Of coercing,
or ever encouraging such borrowers
To make application to this corpora
ton.
The tests OF eligibility are as fol-
lows:
1.-The applicant must have been
In involuntary default on his home
loan on June Is. 1888. and unable 70
carry or refund his present mortgage.
p~oration's satisfaction that a default
poration's satisfaction that a dafault
occurring later than June Is. 1888,
was the result Of unemployment or
other misfortune beyond the appli-
cant's control. The corporation was
created to protect honest home own
ers who are In temporary difficulty,
and not for the purpose OF saving
lenders from the results OF their own
past mistakes in making excessive
leans. or in lending to persons not
entitled to credit.
?. The past record Of the appli-
cant for integrity Is q vital factor.
ANY applicant will be rejected as in
eligible If his general record Is un-
satisfactory, particularly II he has
deliberately defaulted on his exist
ing Indebtedness and has a record
OF not paying his bills when he is able
to do 70.
$40 redeem the home from
forced sale or voluntary surrender,
such sale or surrender must have
taken place since January 1, 1880.
4-The applicant must be in actual
distress with his mortgage indebted
ness and threatened with the loss OF
his home by foreclosure. Applicants
who have no present or prospective
ircome OF any character. and clear
" could not meet the indebtedness.
are ineli lie unless their notes are
also signed b. responsible parties.
5.-The property must be used by
the owner as his home OF held by
him as his homestead. and. As a rule.
It must have been his home on
June 10. 1888.
6.-The home must have a value
not exceeding $4,000 as appraised
by the corporation. No loan may be
made for an amount exceeding Sl4,-
900 or 90 per cent OF the corpora
TONS appraisal Of the property,
whichever Is the smaller.
T.-Ordinary farm property Is not
eligible unless the applicant draws
his main livelihood from non-farm
occupations.
s.-No applicant viii be granted
a loan II such refinancing Is intend
ed only 10 protect a bank loan or
other business obligation.
e.-The corporation will not re-
finance the home OF an owner who
can continue to carry his present
loan"