Evening star., 1938-05-07
MORTGAGE UNIT
VALUE STRESSED
F. H. A. Official Discusses
National Association
at Richmond.
epeciai Dispatch to The Star.

tptctai Dispatch to The Star.
RICHMOND. May 7.-Importance
OF the national mortgage associations
authorized under recently enacted F.
H. A. amendments was emphasized by
former Gov. Adolph o. Eberhart of
Minnesota. now assistant to the ad-
'mnistrator of F. H. A.. addressing
the Central Atlantic Regional Confer
ence Of the National Association of
Real Estate Boards here today.
During the last three years the
real estate boards of the country have
been almost unanimous in demanding
' separate strong financial institution
that could furnish an unlimited mar
ket for insured mortgages" he said
The provision for national mortgage
saSSoclatlonS Is one vital change made
by the new amendments.
Mr.. Eberhart stressed particularly
two ways in which these proposed in
stitutions. the first of which has al
ready been formed will enhance the
whole effect of the new legislation on
future construction: First. with the
Cooperation of the national mort.
sage associations. the financial prob
lens of large-scale construction of de-
tached homes or of rental housing is
practically solved. he pointed out Sec
ond. he said. the facilities of the ma
tlonal mortgage associations are par
'tlcularly important. III view of the eX-
tension Of home mortgage insurance in
certain cases up TO 80 per cent Of
value.
Concern Entire Community
The large projects which are newly
opened 10 mortgage insurance under
the new amendments. including as
they do both group developments of
detached houses and multi-family
structures singly or in groups. are de-
velopments that concern the entire
community, Mr.. Eberhart said. The
large scale development affords parks
and Fairgrounds, plenty of open space
Tor light and air and gives to the
community the factors which make
Tor healthy and comfortable living.
Under new amendments to F. H. A..
responsible contractors and builders
operating under the new amendments
can either sell or rent the properties
SO brought into existence. In pur-
chasing material these large opera
tions make possible better deals for
material and equipment and also with
labor on the basis of long time en-
ployment.
AS TO the extension of mortgage in
surance which makes home purchase
possible with a comparatively small
down payment. Mr.. Eberhart said that
IN England. for instance. where the
new home-building program has been
conducted so successfully during the
last 10 years. they have found by ex-
perience that even a per cent down
payment on these small homes will
work out satisfactorily. From the
English experience Sir Thomas Keene
of Ideal Homesteads states positively
that the down payment on a monthly
amortlzed mortgage is not the most
important feature and that the inves-
tleatlon of the borrowers credit stand
ing and permanent employment. as is
now done by the Federal Housing Ad-
mlnstration, is infinitely more i'm
portant.
Under One-Fifth Of Income.
Nine-tenths of the borrowers whose
home mortgage have been insured by
the Federal Housing Administration
are paying less than one-fifth of their
earnings, or income, to cover the
monthly installments. he pointed out.
Craftsmanship has changed very