Evening star., 1935-11-16
INCREASED LOAN
OPPORTUNITY SEEN
Building Loan League Head
Sees 5000, 900, 900 Worth
OF New Construction.


Savings. building and loan associa-
tions will have an opportunity to make
sound loans on $600,000.000 to S700,-
600 900 worth of newly constructed one
and two family homes in 1896. if the
present rate of pickup in construction
continues.
This was the statement of I. Fried
lander. Houston, Tex. president of the
United States Building and Loan
League. in his address before the forty
third annual convention of the league
held in Cincinnati this week. He
pointed out that this is field where
the associations have served we'll and
are best fitted by experience, fixed
purpose and local autonomy to serve
again.
The interest rate upon home mort
gage loans, as important as it may be
conceded to be, can hardly be said to
have justified all of that attention
which it has been given to the eXclu-
sive of other important factors in home
ownership costs" he said For those
who do not borrow money it does not,
OF course, constitute any part of their
cost. but every home builder. whether
using his own funds or those which
he may borrow, cannot escape the fact
that he must pay as compared with
pre-war prices the added percentage
of: Materials, 80 per cent; trans
portation, As per cent; distribution,
20 per cent; building labor. so per
cent; when he undertakes the building
OF home"
Cites Government Part.
Speaking on the convenient keynote
OF National Security Through In
dividual Thrift and Home Owner
ship" Friedlander said that the Gov
ernment's steps in the direction of
national security attempt nothing
more than the provision of security
Mt subsistence level such as would
be satisfactory only to the under
privileged and the groups which have
not taken care of their own future
security out Of their own industry,
frugality and prudence.
bare necessities" he said For at
least 90 per cent of our population
the formula for personal security of
q degree satisfactory to themselves lies
exactly where it has lain since the
founding of the Republican the grad
ual building out of earnings over the
years of sufficient store of increment
the income from which may enable
them to provide for their loved ones
and dependents and to stand by them
selves.
Must Convince Citizens.
He said that the building and loan
business must concern itself with
building up the citizens belief in his
ability as we'll as his right to achieve
his own security.
1T is conceded that there are today
many of those whom encouragement,
the sense of futility, or the unfortunate
experiences with previous investment
efforts have driven to the belief that
they cannot care for themselves" he
continued. National security can be
indefinitely held back by the main
tenance of that point of view by any
considerable group of citizens"
The business of building and lend
ing must frankly face the danger of
Initiation, in my Friedlander'S opinion.
LAS trustee of the funds of nine mil
Hon savers we are expected to speak !
for their interests in this matter he
said. They have no one to whom to
look for leadership or guidance in the
savings unless they can depend upon |
the managers of the institutions which |
are trustees for their money. There |
fore. building and loan associations !
cannot blithely pass over the dangers
OF imitation"
More Attention to Lending.
The speaker said that more atten-
tion has been paid to mortgage lend
ing, especially on residential prop
critics, during the last four years than
st any time in previous history.
In that sphere our building and
foam associations occupy unique
position" he stated. I'VE are the |
only lending Institutions in this coun-
try practically all of whose business
or financial policy has been so clearly |
set apart as sound home financing |
instrument. The Government, when |
creating the Federal Home Loan Bank
System, gave preference on collateral |
TO this type of loan. Then the Home
Owners Loan Corp. decided that the
way to relieve distressed home owner
was first to place his home financing
on the basis of the amortized loan. |
Thence followed the Federal Housing
prescribing the only
type Of loan which might be insured
under that act to be the long-term,
monthly repayment kind of obliga-
ton. with few variations, the same
as we have been using for los years."