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House Speech Cooperative Housing Bill, March 22, 1950
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House Speech Cooperative Housing Bill, March 22, 1950
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The original documents are located in Box D13, folder "House Speech Cooperative
Housing Bill, March 22, 1950" of the Ford Congressional Papers: Press Secretary and
Speech File at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. The Council donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Speech by Representative Harnld Ford Jr during debate on
Corporative Housing bill
March 22, 1950
MR. CHAIRMAN, before any member of the House votes for or
against the controversial Title I of H.R.7402 I firmly believe a therough
and complete examination should be made of the precise situation in each
Representative's respective district. Although we are legislating for the
benefit of the nation as a whole, none of us should forget that we also
represent limited geographical areas. We have a responsibility to reflect
the views, understand the problems and seek answers for the citizens who live
in our own congressional districts.
No one denies that our nation still needs additional housing
particularly in certain areas where the shortage of homes is still acute.
The problem is how to ready the situation. Should we enset Title I, the
Cooperative Housing Act, or should we rely on a continuation of legislation
such as our existing F.H.A. statute which has worked rather effectively for
a number of years.
Under the controversial Title I of H.R.7402 approximately 250,000
homes can be constructed. A new federal agency, the Cooperative Housing
Administration, will handle the job if Title I is approved. Interest rates
will be 3% and the amortization period for the mortgages will range between
FORD i LIBRARY GERALI
Digitized from Box D13 of The Ford Congressional Papers: Press Secretary and Speech File at the Gerald R. Ford Presidential Library
Page Two
50 and 60 years. Down payments will be required. The group seeking to set
up a cooperative project must buy an amount of stock in the Cooperative Hous-
ing Administration equal to 23% of the total cost of their project at the time
the contract for mortgage financing is signed. At the time each family is ready
to move in it must put up another 23%. In other words, the total down payment
is 5%. This would amount to $40 on s home costing $8,000 or $300 on a $6,000
home.
With these facts in mind, will Title I aid in solving the housing
problem in Kent and Oktawa Counties of Michigan, my district. The proposal
might be helpful in some instances but let's examine the record to see whether
or not it might have discriminatory or harmful results. Further, will the
co-op prevision provide a solution which is not already on the statute books.
Titles II and VI of the previous F.H.A. legislation have proved
extremely helpful in Kent and Ottawa Counties. I believe we can peint with
pride to the job done by our losal office in Grand Rapids. From various sources
and efter considerable digging for the fasts, I have prepared the following
table. Here is the record from January 1, 1946 through December 1, 1949.
FORD i LIBRARY
Page Three
Type of Loan
Committed
Amount
1946-1949
of Guaranty
Insured
Amount
KENT COUNTY
Titles II and VI
3,670
$23,845,000
2,621
$17,032,000
See. 203 2(b)(D)
257
124
OTTAWA COUNTY
Titles II & VI
475
$ 3,087,500
340
$ 2,205,300
See. 203 2(b)(D)
10
6
I am particularly interested in the See. 203 2(b)(D) leans for I
was somewhat instrumental in initiating the use of this provision among Grand
Rapids leaning institutions. This provision provides for mortgages up to
$6,000, at 43% with a maximum term of 30 years. The above chart indicates
257 leans of this type are committed in Kent County and 10 in Ottawa County.
In other words, a person, veteran or otherwise, under this provision
can buy his own home with a down payment of $300 to $400 and monthly charges
of approximately $41 including payment on principal, interest, taxes and
insurance. These homes must meet F.H.A. specifications. They include 2
bedrooms, a living room, a kitchen and dinette, full basement, gas furnace,
plastered walls, and a reasonably sised lot.
FORD
In addition I would like to mention homes that are being constructed
LIBRARY
in a slightly higher price range. Here is the copy of an advertisement in the
Page Four
Grand Rapids Herald of March 19, 1950 -
"THIS HOME ON YOUR LOT $6,800
"Only Cash Required $150 for Mortgage Costs.
2 Large Bedrooms
Spacious Living Room
Large Kitchen and Dinette
Full Basement 32'x24'
Gas Furnace and Hot Water Heater
Plastered Walls
Not Prefabriested.
843 Monthly payments Includes Taxes and Insurance. All This
On Your Lot If Acceptable to FHA or Veterans Administration.
Public Water Supply Must be Available.
NO LOT?
"To veterans only. Call us anyway. If you have $300 to $400 each it may
be possible to build this house on a lot of your one) choice. We have several
lots available or perhaps you have a lot which you would like us to buy for
you."
I ask in all sincerity, isn't this the kind of housing which is needed, at the
right price and on fair terms? The local newspapers include other rather similar
advertisements. Another "ad" reads as follows: "No down payment to a veteran.
043 per month (including taxes and insurance)." Here is another advertisement:
"Twe-bedroom, lig-stery bungelow. Room for third bedroom. Pull base-
ment 32'x24'. Gas furnace, automatic water heater. Large living
room, combination kitchen and dinette. Near schools. Can be
purchased on FHA terms or GI lean.
"$250 down to veterans covers all mortgage costs; $56 monthly pay-
ment includes taxes and insurance."
One of the most perplexing problems to low cost home purchasers is the
down payment whether it be $100 or $1,000. Under a combination of Title II
leans and GI financing homes can be financed with no down payment. I believe
under Title I a 5% down payment in two installments is mandatory with some very
limited qualification. In other words, Title I will not help the person in the
low income group who cannot acquire sufficient funds for the down payment. In
contrast, as I have said before, a combination F.N.A.-G.I. Loan will obviate the
necessity of a down payment.
GERALD FORD VIBRARY
Page Five
There is justification to the argument that Title I is discrim-
inatory, particularly as regards G.I.s of World War II who have already
purchased homes with the help of a O.I. loan guaranty. In Ottawa County
938 G.I.S as of February 25, 1950 are now buying homes at 4% on a 20 year
term. In Kent County as of February 25, 1950, there are 3,085 G.I.s in the
same eategory. These veterans would be diseriminated against by the exetment
of Title I. There is no 3% interest rate for them. They have no 50 to 60
year term for the repayment of their loan.
I recently compiled some facts and figures on the situation in
Kent and Ottawa Counties, which should be included in the record.
KENT COUNTY
OTTAWA COUNTY
W.W.I Veterans
7,759
1,551
W.W.II Veterans
29,472
6,488
Total
37,231
8,039
KENT COUNTY G.I. LOAN DATAAS OF FEBRUARY 25,1950
Type of Loan
Number of
Amt. of guaranty
Total Dollar
Loans
and/or Insurance
Amounts of Loans
Home
3,085
$8,627,290.00
$17,388,418.00
Farm
18
43,182.00
90,344.00
Business
137
179,023.00
394,054.00
Total
3,240
$8,849,495.00
$17,672,816.00
OTTAWA COUNTY G.I. LOAN DATA AS OF FEBRUARY 25,1950
Number of
Amt. of guaranty
Total Dollar
Type of Loan
Leans
and/or Insurance
Amounts of Loans
Home
938
$2,359,920.00
$4,748,253.00
Farm
6
15,900.00
31,800.00
Business
$
78,257.00
161,305.00
FORD & LIBRARY GERALD
Total
1,004
$2,454,077.00
$4,941,358.00
Page Six
If the 3% rate in Title I is raised to 4% there will be no
discrimination against those veterans of World War II in Kent and Ottawa
Counties who haven't yet purchased a home with a G.I. loan but there will
be an overlasting bias against the 4023 who have already bought or constructed
their homes. This injustice can never be corrested unless the 50 to 60 year
loan term provision is corrected.
The gentlemen from Michigan, Mr. Walcott, ably showed how
ridiculous the 50 to 60 year amortisation schedule is under Title I. A
veteran who is now 25 years old will finish paying for his home at the
age of 75 or 85. Obvieusly this is unsound on its face.
The advocates of Title I claim there will be no additional
cost to the federal government. What about the new agency with the tre-
mendous staff that will be required to handle the "se-op" loan applications.
It will undoubtedly require at least 5000 new federal employees plus a
director at $15,000 per year. The federal treasury can't stand this
additional burden.
In conclusion, I vish to emphasise my opposition to Title I
for the following reasons: 1) it will discriminate against G.I.s who have
FORD is LIBRARY CERVID
Page Seven
already purchased homes, s cme 4023 in my district; 2) the Administrative cost
burdens will be excessive; the federal treasury can't afford a now federal
agency with some 5000 additional employees; 3) existing F.H.A.-G.I. loan
pregrams can and will provide an ample supply of low cost and middle income
homes.
FORD & LIBRARY GERALD