An HOLC Primer
An HOLC Primer
This chapter describes the basic operations of the HOLC and gives a chronology of its activities. The HOLC bought distressed loans from lenders and refinanced those loans for borrowers from 1933 to 1936. It then serviced these loans until its portfolio was finally liquidated in 1952. In performing these roles the HOLC functioned as both a loan refinance program and a bad bank. During its first three years the HOLC determined the scale and scope of its activities by setting eligibility rules for borrowers, by determining the benefits borrowers received from a loan modification, by negotiating with lenders over the purchase price for distressed loans, and by setting the terms of the bonds it issued to finance its activities. After 1936, the HOLC turned its attention to servicing loans, foreclosing upon loans when necessary, and managing and disposing foreclosed properties.
Keywords: Chronology, Bad bank, HOLC operations, Refinancing, Borrower eligibility, Loan servicing, Funding
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