Letter from the Federal Housing Administrator on State Legislation to Supplement the National Housing Act.

My dear Mr. President:

In order that the Federal Housing Administration may attain a full measure of success throughout the country, it is essential that banks, insurance companies, building and loan associations, trust companies, fiduciaries, and other investors be able legally to make insured mortgage loans, and to invest in insured mortgages and in national mortgage association obligations, as provided by the National Housing Act. . . .

At the present time there are in the States various statutory limitations upon loans and investments by the aforementioned investing institutions, which restrict their ability to benefit fully from the National Housing program. A similar limitation upon the lending power of national banks has already been removed by the Congress.

The Legislatures of many States will convene during the next few months. Could you not, with propriety, suggest to the Governors of these States that their statutes should be amended as soon as possible so that banks, insurance companies, building and loan associations, trust companies, fiduciaries and all other investors under statutory restrictions might be permitted legally to make insured mortgage loans and to invest in insured mortgages and in national mortgage association obligations as provided by the National Housing Act?

Respectfully yours,

J. A. MOFFET, Administrator.