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Well Worth SavingHow the New Deal Safeguarded Home Ownership$
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Price V. Fishback, Jonathan Rose, and Kenneth Snowden

Print publication date: 2013

Print ISBN-13: 9780226082448

Published to Chicago Scholarship Online: May 2014

DOI: 10.7208/chicago/9780226082585.001.0001

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PRINTED FROM CHICAGO SCHOLARSHIP ONLINE (www.chicago.universitypressscholarship.com). (c) Copyright University of Chicago Press, 2021. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in CHSO for personal use.date: 24 July 2021

The Lenders’ Good Deal

The Lenders’ Good Deal

(p.70) Chapter 7 The Lenders’ Good Deal
Well Worth Saving

Price Fishback

Jonathan Rose

Kenneth Snowden

University of Chicago Press

This chapter suggests that the HOLC was as much of a lenders’ program as it was a borrowers’ program. The HOLC was able to secure the voluntary participation of large numbers of lenders because it offered them good deals, purchasing many loans at prices at or near the full amounts owed to the lenders. In general HOLC officials often strove to pay lenders as much as they could under the law. Key to this pricing was a liberal implementation of appraisal methodologies, as appraisals were often higher than stricter estimates of market prices. This methodology allowed the HOLC to pay relatively high prices as its payments were limited to a certain percentage of each property’s appraised value. These facts are based on statistics from a sample of HOLC loans in three states and archival HOLC documents discussing bargaining strategy.

Keywords:   Lenders, Participation, Appraisals, Market prices, Bargaining, Loan sample, Archival documents

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