Evening star., 1939-03-04
D. T.. Seen benefitinq
In F. H. A. System
OF Tax Collection
District Director Says
Plan Also Eases
Buyers Burden

Tax collection agencies in the Dis
trict are given valuable assistance
by the requirements of the Fed
eral Housing Administrations in
sured mortgage system, District Dl-
rector H. H. Dearing said today.
Requirements of the F. H. Aim
sured mortgage plan that propor-
tionate share of annual taxes on res
idential property be included IN the
monthly mortgage payments also
provide home buyers with a conven-
lent way of meeting tax obligations,
he pointed out.
Furthermore, the cost of collec-
ton on properties insured by F. H.
A. in the District of Columbia has
been greatly minimized through this
procedure. At the present time
mortgages on lilo properties in the
District, amounting to 1854, $50,
have been accepted for insurance by
the F. H. A. In addition the in
sured mortgage system facilitates
the collection of residential prop
erty taxes on one rental housing
plOJCCU AL UllC DlSUI lSp-~bI C1ltWoOA-
involving a s1,650,000 mortgage.
There can be no tax delinquent
cies on properties financed under
the F. H. A. plan," Mr.. Dearing said.
'The manner in which a typical in
sured mortgage is handled will eX-
plain how taxpayers and tax COL
lection agencies benefit from the F.
H. A. system. When Government
insurance is granted on a mortgage
the home buyer receives exact in
formation as to how he must repay
the obligation. The mortgage is to
be repaid in equal monthly INSTALL
ments in periods up to 20 or Is years.
Included in these equal monthly
payments are prc-rated items for
fire, hazard and other insurance and
for taxes.
THUS, the purchaser is not called
upon to make lump-sum cash out
lay for his taxes, but is automat-
1cally meeting this obligation in
equal monthly installments. This
method eases the burden on the tax
payer and also is of great conven-
4CilSC W lIlC IdA SOl1CCIUl.
Our procedure eliminates indi-
vidual contact for collectors and
thus produces material savings. The
home buyers make their monthly
payments to the respective banks,
building and loan associations. mort
gage companies and other lenders
qualified to operate under the F. H.
A. system. The lenders. in turn,
compile the total tax obligation on
all properties financed through
them and make lump payment to
the tax collection agencies when the
due date arrives. Thus, the F. H.
A.-insured mortgage system saves
money for the city, the county and
the State and eases the burden for
the property owner"
Mr.. Dearing said that this benefit
to tax collection agencies is Ma
tion-wide, there being approximate
ly $1,500, 100000 in residential prop
critics financed under the F.. H. A.
insured mortgage system through
out the country. Added to this are
about $75,000000 of rental housing
mortgages which are premium pay
ing and from which tax collections
are assured because of the super
vision of the F. H. A. over these
developments. In the case of null
tiple-family and group housing prof.
ects, an F. H. A. representative, sit
ting on the Board of Directors of
the limited-d dividend corporation
sponsoring the project, sees to it
that proper provision is made for
tax payments on the due date.