Limiting the amount of the loan, in combination with provision for collective bargaining as to loan practices, will act, we believe, as a better check on exhausting the Government's home-mortgage relief funds than a limitation on the assessed valuation of the home. Third. The limitation of $10,000 is penalizing the man who has bought the best he could afford for his family. The purpose of all legislation of this sort is to encourage, not to discourage, better standards of living. Again, may we urge upon you careful consideration of these amendments. Yours very truly, THE HOME-LOAN BUNK WILLIAM F. GODDARD, LOST-MILLIONS OF HOMES Foreclosures and tax sales that came in the wake of depression have already swept away 2,000,000 homes. And with them have vanished the life savings, the sense of security, pride of ownership, courage, and hope of more than 8,000,000 men and women. CAPITALIZING HUMAN MISERY FOR VOTES When home owners read the early and frequent announcements from the White House that President Hoover's Home Loan Bank Act would save their mortgage-menaced homes from the auctioneer's block, they gave thanks that rescue was near. Immediately pathetic appeals for aid flooded the Washington office of the Federal Home Loan Board. But they soon found out that the home-loan banks do not hold out immediate or substantial help to the small home owners as Hoover publicity deluded them into thinking. The truth is that: The Hoover home-loan bank law does not compel banks and loan associations to share the benefits they enjoy at the expense of the taxpayers with the burdened home owner whom the law was supposed to protect. If it is more profitable for them to force payment or foreclosure on old mortgages, and with the money make new mortgages on newer homes at higher rates of interest, there is nothing in the home-loan bank law to prevent such action. Furthermore, the home owner as such is definitely barred from membership in the directorate controlling Mr. Hoover's home-loan bank. According to the law, only those connected with home-financing business can be elected directors. THE WOLF AT THE DOOR Exorbitant interest rates still threaten the home owner. When friends of home owners amended the home-loan bank bill to limit service to loaning agencies that charged only legal interest, Hoover spokesmen got that amendment twisted to read "legal or lawful contract rate "-a loophole through which ruinous rates can continue to menace home owners. DEMOCRATS PLEDGE SECURITY TO HOME OWNERS The Democratic candidate for President, Franklin D. Roosevelt, said in his acceptance speech: 'Rediscounting of * * * mortgages under statutory restrictions must be expanded and should, in the future, be conditional on the reduction of interest rates. Amortization payments, maturities, should likewise in this crisis be extended before rediscount (i.e., loaning money to banks and loaning agencies on the mortgages they hold) is permitted where the mortgagor is sorely pressed. * * * "Take away that specter of too high interest rates. * * * Save homes; save homes for thousands of self-respecting families and drive out the specter of insecurity in our midst." Vote to protect your home; vote for Roosevelt and Garner. [Issued by Democratic National Campaign Committee, Hotel Biltmore, New York City.] BRIEF DESCRIBING LORAIN COUNTY, OHIO, IN CONNECTION WITH RELIEF FOR MORTGAGE LOANS SUBMITTED BY THE ELYRIA CHAMBER OF COMMERCE GENERAL INFORMATION Lorain County lies immediately west of Cleveland, Ohio, and is bounded on the north by Lake Erie. It has 110,000 population of which over 70,000 lies within the industrial cities of Elyria and Lorain. By far the largest employer of labor in the city of Lorain is the National Tube Co., normally employing about 10,000 men. For the past few years it has not operated at more than 25 percent capacity. The industries in Elyria are much more widely diversified. The census of manufactures lists 49 industrial employers in 1931 as compared to 61 in 1929. Number of employees decreased from 4,989 in 1929 to 2,671 in 1931 and wages decreased from over $7,000,000 in 1929 to less than $3,000,000 in 1931. According to the census of distribution taken in 1929 there were 2,900 people employed by the retail stores of Elyria and Lorain which had net sales of over $36,500,000. According to the best information we are able to gather, employment in stores now is not more than 70 percent of the 1929 figure and sales have not been over 40 percent of 1929. About 20 percent of the families in Elyria and over 25 percent of those in Lorain are being supported by public charity. There are 3,000 farms comprising 238,000 acres in the county and these farms are valued at over $31,000,000, or approximately $10,000 per farm. The average value of farm land per acre is $130. Farm products produced by 2,840 farms in the county which reported to the last census are valued at over $5,000,000 of which over half is produced by dairy farming. Approximately 2,500 of the farms in this county are operated by their owners. (Data from the last Federal census.) BANKING SITUATION There are 15 banks in Lorain County exclusive of a branch of the Cleveland Trust Co. Thirteen of these are State banks and two are national banks. Only 3 out of the 15 banks have been licensed to reopen on a 100 percent basis since the national banking holiday. Practically all the others have restricted withdrawals to 2 percent of deposits. As will be seen in the following table the banks which are open have only 11.8 percent of the total deposits in all banks and 11.3 percent of the total assets. The open banks are carrying about 11.5 percent of the total mortgage loans. The following table shows how badly Lorain County needs banking facilities and what a large proportion of the deposits would be freed if some way could be found to raise cash upon the mortgages held by the banks: Several of the State banks in Lorain County have not been examined by the State banking department since the holiday. If the percentage in all banks is approximately the same as was found to hold true in the three Elyria banks, however, about one eighth of all mortgage loans in the county are delinquent at least 1 year in interest and taxes. In all cases these are written off by the State banking department and there is little likelihood that any cash can be realized from them for several years, although in many cases the risk is a good moral risk and the loan ultimately will be paid. In addition to these loans there are thousands of other mortgage loans which are held by the banks and savings and loan companies in Lorain County which are delinquent as to principal. Local bankers tell us that practically all mortgages are on property valued for less than $15,000. As shown by the general information above, industrial conditions affect directly almost 70 percent of the inhabitants of Lorain County. General business is almost completely at a standstill until the banks reopen, and the banks |