A bill to amend section 24 of the Federal Reserve Act to simplify, consolidate, and improve the law relating to the investment in mortgages and residential real estate by national banks, and to enable the Federal Reserve banks to extend credit to member banks on any sound collateral at a uniform rate of interest.
Mortgage Investment Act - Allows national banks to make loans secured by unimproved real estate to the extent of 66 2/3 percent of appraised value and removes the requirement that real estate loans be secured only by first liens provided the amount of the loan when added to the amount unpaid upon prior liens does not exceed the applicable ratio of loan to value requirements.
Requires the amortization of individual loans only if the loan exceeds 75 percent of the appraised value, or if the real property is improved by a dwelling for one to four families. Provides that the payments in such situations must be sufficient to amortize the entire principal of the loan within a period of not more than thirty years.
Provides that the amount of any real estate loan made by a national bank shall not exceed 66 2/3 percent of the appraised value if such real estate is unimproved, 75 percent of the appraised value if such real estate is improved by off-site improvements such as streets, water sewers, or other utilities, 75 percent of the appraised value if such real estate is in the process of being improved by a building or buildings to be constructed or in the process of construction, or 90 percent of the appraised value if such real estate is improved by a building or buildings.
States that the provisions of this Act shall not apply to specified real estate loans.
Provides that where a loan is secured by real estate and non-real estate collateral, only the amount by which the loan exceeds the value of the collateral of such other security shall be considered as a loan upon the security of real estate.
Permits real estate loans secured by forest tracts to be made up to 66 2/3 percent of the appraised value of the growing timber, lands and improvements thereon, and states that such loans shall be in the form of an obligation or obligations secured by mortgage, trust deed, or other such instrument.
Provides that any national banking association may make loans upon the security of real estate that does not comply with the limitations and restrictions in this Act if the total unpaid amount loaned does not exceed 10 percent of the amount that a national banking association may invest in real estate loans.
Introduced in Senate
Referred to Senate Committee on Banking, Housing and Urban Affairs.
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