e total
price paid by the buyer. Formerly such mortgages were for a short
term, three or five years, and payable in full at the end of that
period. Now some of them are for longer periods and provide for
monthly amortization charges by which the mortgage is paid in full by
the end of the time specified.

The Federal Housing Administration mortgages, which are a recent New
Deal endeavor to make funds for home buying or building safe and
stable, are issued by local banks with the payment of interest and
principle guaranteed to the bank through the operation of this
government controlled agency. These mortgages are amortized over
periods of ten, fifteen, and twenty years and the borrower must make
specified monthly payments that include taxes, interest charges, and
amortization. They are not available in all sections because some
local banks hold that they conflict in details with other banking
regulations. So far as the borrower is concerned, these mortgages are
no different from any other similar method of financing. If payments
are not made regularly and promptly, foreclosure proceedings will be
started.

Large insurance companies or savings and loan associations also issue
fifteen to twenty year first mortgages, amortized over the period by
monthly, quarterly, or semi-annual payments. The interest rate varies
from five to five and a half per cent. If such a mortgage is arranged
for a new house, architect's plans and specifications must be
submitted with the application for loan. The site must be free and
clear of all mortgages or other obligations. Your own financial rating
is looked up by the lender and, if satisfactory, the company issues a
commitment that you can take to your local bank where definite amounts
are paid as the work progresses; so much when exterior walls are
complete; such a proportion when rough piping for plumbing has been
installed; another amount when all lath and plaster has been finished;
and so on until the final payment when the house is finished. Then the
formal mortgage is executed and recorded. There are brokers who
specialize in negotiating such mortgages. Their fee is about two per
cent.

So much for the usual channels of financing. In addition, the buyer
can still make his own mortgage arrangements with some investor who
has money to loan if he knows such a person. Further, although second
mortgages should be avoided if possible, they are sometimes issued
where a buyer is considered