Evening star., 1938-11-19
Federal Board Says
Ample Home Funds
Can Be Obtained
Private Institutions Held
Able to Finance Much
Larger Volume

On the basis of recent surveys
made by its division of research and
statistics the Federal Home Loan
Bank Board today asserted ample
funds are available for extensive
expansion Of residential building
throughout the country.
Whatever the causes of the slack
in residential construction" said the
optimistic statement by the board,
scarcity OF mortgage funds at rea-
sonable terms is not one of them.
Private lending institutions of all
types are able and willing to finance
a much larger volume of residential
building than has been taking place
IN recent years.
In further comment upon the
availability of home-building credit
the boards statement said:
LAS is evidenced by our tables,
H1e estimated value of home mort
gage loans made by private financial
institutions almost trebled from
1884 to 1887, reaching $1,559, ,000, 900
In the latter year. In the first six
months of 1888, however, the esti-
mated volume of home mortgage
loans written by such institutional
lenders showed decrease of ap-
proXimately II per cent as COM
pared with the corresponding period
of 1937-a small reduction in view
of the drop in general economic
activity"
Half of Mortgage Loans.
The board finds its statistics indi-
cate that of the total estimated
amount of home mortgage loans
made by institutional lenders dur
ing the last few years savings and
loan associations alone provided
about one-half. In 1887 their VOL
ume of new home mortgage loans
was twice as large as in 1884. Life
insurance companies, for want of
other earning assets, have expanded
their home mortgage lending &C
tivity since 1894.
Commercial banks likewise have
increased their lending activity,
particularly in connection with
mortgage insurance under the Ma
tional Housing Act. The share of
commercial banks and insurance
companies in total home mortgage
lending. however, has always been
substantially smaller than that of
savings and loan associations.
Account for 40 Per Cent.
within this field member inSti-
tutions of the Federal Home Loan
Bank System are responsible for a
large portion of lending activity.
OF the estimated total volume of
home mortgage loans made by in
stitutional lenders in the last two
years members of the bank system
accounted for about 40 per cent.
OF the loans made by savings and
loan associations during the same
period associations which were
members of the Federal Home Loan
Bank System accounted for about
rs per cent and Federal savings
and loan associations alone for ap-
proximately IS per cent.
Despite the increase in total
lending activity in recent years the
estimated total home mortgage in
debtedness has constantly decreased
This was due mainly to the acquisi-
tion of mortgaged properties by
lending institutions and the amor
tization of outstanding mortgages.
The estimated total home mortgage
debt at the end of 1887 was $780,.
100000, compared with a peak OF
almost $4,000 100000 in 1890.
Loans for new construction
amounted to only about 80 per cent
Of total home mortgage loans made
by savings and loan associations,
commercial banks life insurance
companies and mutual savings
banks in 1937-a reflection of the
still restricted activity in residential
building. The remainder served for
home purchase, refinancing, recon-
ditioning and other purposes"