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The HOLC can help to refinance home mortgages currently in default to prevent foreclosure.

 

"Help homeowners keep their home"

Home Owners' Loan Corporation

H.O.L.C.

Ella Siembieda

 

 

The Home Owners' Loan Corporation was established in 1933 and ended in 1951. 

 

 

The Home Owners' Loan Corporation was a relief program during the Great Depression created to help homeowners pay off their mortgage debt.

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bonds

 debt

 foreclosure

 lenders

loans

 mortgage

 property

refinance

relief

taxes

 

The Home Owners' Loan Corporation was a form of relief during the Great Depression. The HOLC issued bonds and they then used them to purchase mortgage loans from lenders. Homeowners were the people to purchase these loans because they were having issues making payment on their mortgage debts. This program helped lenders make money also. The HOLC bought the loans by offering bonds that were equal in value to the amount owed by the borrower. They got more money from the unpaid interest on the loan and taxes that the lender had to pay on the property. This amount was then refinanced for the borrower. This system helped the borrower by allowing them more time to pay their mortgage debt and the rate of pay was a smaller amount. The average HOLC loan was a 15-year loan. The average loan from a bank was 3-6 years and Building and Loans offered 10-12-year loans. The HOLC offered 5 percent and most loans were offered at 6-8 percent. The rate was then lowered to 4 1/2 percent by HOLC. After making a little over 1 million loans HOLC focused on repaying the loans. The loans that were typically refinanced were the borrowers that were more than 2 years behind on payments and more than 2 years behind on paying taxes for the property. About 20 percent of the homes that were refinanced were foreclosed by HOLC. Eventually, homes were paid off and the last assets were sold to private lenders.

Franklin Delano Roosevelt (1882-1945)

  • FDR was the 32nd President of the United States.
  • He was a democrat.
  • At the time of the Great Depression, Republicans were blamed so FDR had an advantage being a democrat.
  • "The only thing we have to fear is fear itself."
  • FDR was the promising president who gave the U.S. hope that they would get through the Great Depression
  • He came up with the New Deal - a group of government programs designed to improve conditions for the suffering people.
  • FDR signed the Social Security Act to protect seniors and it is still used today.
  • He was married to Anna Eleanor Roosevelt.
  • FDR was appointed Assistant Secretary of the Nav by Woodrow Wilson.
  • While he was married to Anna Eleanor Roosevelt, he had an affair with her secretary, Lucy Mercer, and when Anna threatened for divorce he still had an affair with her, but secretly.
  • FDR was diagnosed with Polio and thought it would end his political career, but with enough support from his family, he was able to get help in secret and nobody knew.

HOLC Effects on Economy

 

 

Unemployment Rate: decreased

Government Spending: increased

GDP: unaffected 

Confidence Building: increased

Role of the Government: increased

Population Groups Affected: people with no money