Evening star., 1952-01-23
Higher Down Payment
On 81 Homes Likely,
Foley Tells Builders
By Robert ]. Lewis
stor staff Correspondent


CHICAGO, Jan. 23.--LargerI
cash down payments today ap-I
peared to be In store for home
buyers in non-defense areas. In
cluding Washington, as means
Of holding down production toI
this years ceiling Of 100000
homes.
Addressing the Nations home
builders convention here. Hous-
ing and Home Finance Admins
traitor Raymond M. Foley indi-
Gated that Congress would bel
asked to give the. housing and
home finance agency and the Fed
eral Reserve Board standby au-|
thority to raise down payment
requirements on houses costing
under $4,000.
''Flexibility should be restored to
the credit controls system so that
we can use it If necessary" MIR.
Foley said.
Foresees Difficulties.
At another convention session.
yesterday, Guy e. Noyes, assistant
director Of the Federal Reserve
Boards division Of selective reg
ulations, said there. was doubt
whether 1t would be possible tol
hold 1852 annual output within
the limit established January Il
unless higher cash down payments
could be decreed.
''It win be up to Congress tol
determine what steps win have to|
be taken" MIR. Noyes said.
Disclosure that higher down
payments may be needed followed
the recent announcement Of al
sharply decreased ALLEGATION OF
materials for home building this
year, and reports that stringent
conservation regulations would be
imposed, including square-foot
limitation on the size Of homes.
Down Payments Eased.'
Whether higher mortgage credit |
eurbs are in the wind for houses
over $4,000 was not made clear.
Congress not long ago nberalized
cash down payment requirements
for houses costing $4,000 or less.
Down payments pow are 8 per
cent for the $4,000 house and as
low as 4 per cent on the $1,000
house.
Down payments for non-veter-
ans now are 40 per cent on the
$4,000 house and 10 per cent on
the $1,000 house.
These are substantially below
original Regulation x require
ments, which are still in effect on
houses over $4,000. The Regula-
ton x down payments are on a
sliding scale going up to so per
cent for non-veterans on houses
costing $24.500 or more and IS
per cent for veterans.
In areas certified by the Gov
ernment as critical defense holis-
ing areas" these high down-pay- \
ment terms have been liberslized \
to channel more building ihto1
such areas.
Senator Sparkman Speaks.
Delegates to the National Asso-
citation of Home Builders conven-
ton yesterday heard Senator
Sparkman, Democrat. Of Alabama
warn private financing institu-
tions to provide adequate mort
gage credit for this years housing
goal or face possibility that the |
Government may have 10 inter-
Vene. i
Replying to Aubrey Costa.
president Of the Mortgage Bank
ers Association, who told the con-
vention that q higher interest
rate was justified on CT home |
loans, the Alabama Senator said: |
ITO break the 4 per cent rate |
for veterans would be to break
the pledge to veterans. ! do not |
expect congressional action to
change the interest rate"
Referring to the private 11nanc-
ing industry, he said:
I'VE are going to throw up this |
warning to them: We are going to 1
see that this needed housing is 4
built. We are going to see that 1t
is financed. And ! believe that
private financing institutions are |
really going to handle the job. 1
Sees Easing Of Money.
He added he thought that tfbe-
fore the year is out they'll have \
30 much money they'll be begging \
for mortgages at 4, and four -and- H
R-quarter per cent"
On the other hand, Represent 4
ative Wolcott, Republican. Of
Michigan, said he believed interest
rates would have to rise, and that
he wouldn't be surprised to see
Congress approve a higher interest
rate"
A panel debate elected from
Bert M. King, loan guarantee |
officer Of the Veterans Admin
istration, the statement that 49,
900 homes a month are being 4
financed under CT terms and that 4
VA expects to provide about IS
L