Let the Borrower Beware! :
ELooIdng For A
Home Mortgage?
".If it so happen that you are a black American and.
want to purchase or refinance a home the chances are
better than ever that you will face what has been termed
"double discnmmation" because of your race and,
; because of where you choose to live. . . ' . .- .
. f ,' Although outright acts of discrimination in lending;
. : are much less frequent in recent years, you need only v
'talk to a black twho has tried to obtain a conventional '
(non-government insured) home mortgage to learn that
race continues to play a major role in the terms of a loan
that you will be offered if offered at all. To reduce
the chances of racial bias, borrowers should insist upon
- filing a written application with each lender they ap
proach. Next, under the Community Reinvestment Act
and Equal Credit Opportunity rules, you may request
financial institutions to show you their loan policy state
ment, which describes their service area; down payment
requirements, jcurrent interest charges and other condi
tions applicable to everyone. , .
Because of the many different forms Of mortgages
now being offered to borrowers, anyone thinking about
buying or even selling a home in today's roller-coaster
! money market, would be wise to find out more about
I the options open to them, or seek professional help
i from independent sources. One thing is for sure; it pays
,' to shop for a loan just as you would in buying groceries.
Some lenders offer better deals than other. A half point
' difference in interest rates an mean thousands of
dollars more or less in the years ahead. Look for restric
tions in your mortgage such as prepayment penalties,
due-on-sale clauses and future automatic increases in
; monthly payments tied to cost of money indexes.
Despite rules of thumb that say total housing costs
should not "exceed a certain percentage of your income,
' loan underwriting still is based largely on subjective
; judgment. Lenders look at your credit history, savings
habits and job stability. Some charge application fees
and all will want a service charge or points for making
the loan. To make your own comparisons of the total
cost of borrowing, ask for the Annual Percentage Rate
(APR). It is a computation of the interest rate quoted
you plus all other expenses that yotfmust pay, spread
over the life of the loan.
A good place to begin looking for a loan is your own
bank or savings and loan, where you are known. Many
offer lower rates, etc., to their own customers. Other
sources are mortgage banking firms who generally make
FHA or VA loans and credit unions who have recently
been authorized to make real estate loans. Some life in
surance companies are becoming active again in single
family financing.
For the past forty years, jhc fully amortizing, level
payment mortgage with a fixed interest rate over the en
tire loan term has been the basic financing mechanism in
this country. In recent years, due to inflation, use of this
kind of mortgage is rapidly disappearing. Except for
FHA, VA and Farmers Home loans, they are pretty
hard to find. Most of the creative new mortgage in
struments allow the borrower to pay less in, the early
years but require larger monthly payments later on.
Civil rights and consumers groups have been highly
critical of these new plans. They should be thoroughly
understOoMy borrowers .before taking them on. By
law, lenders must explain to borrowers these new loan
terms and, in some, cases, offer a choice of fixed-rate
financing. . .-v.. ."..;!'
: After cautiously testing the adjustable-rate mortgage .
waterforH&rw-yj
Board, in April, plunged in with regulations that
"' remove all interest rate and principal payment restric
tions for all federally-chartered savings and loan
associations. The new rules will change the familiar
repayment pattern as lenders begin to adjust payments
as often as they want to even monthly based on
changes in an interest-rate-index beyond its control. .
,. To illustrate this process, consider a. $50,000 AdJ
justable Rate Mortgage (ARM) with an initial interest
rate of 12, a thirty-year term and a.7.5 limit on pay
ment increases. The monthly payments for principal;,
and interest in the first year would be $514.(56. But the
payment cap will limit the payments in the second year
to $552.88, leaving $28.34 of unpaid interest each
month to be added to the principal loan balance. At 1
least once every five years, the payments must be ad-
justed to put back on a fully amortizing basis over the
remainder of the loan term. This could require a hefty r
payment increase if the loan balance has grown substan-'
tially.
The incomes of over half the families in the U.S. have
grown at a rate less than fifteen per cent over the last
several years even moreso for minorities. The nation
must act to keep blacks from being priced out of the
housing market altogether. There have to be better solu
tions than this!
Worship Service To Be
Held For Atlanta Children
' n f4r-siJ ' , -J
government public service
outlays; then ,as produc
tion keeps on rising,, the
tax cuts . will allow the
goods to be bought until
the tax benefits are no
longer sufficient to do the
job at which time the
military expenditures, on
m ever-rising scale will be
called in to stave , off
economic disaster or a'
depression. 1 - .
. " In essence" the 'arms
budget has been
designated as the great
. economic stabilizer for the
next period of time. Ob-
viously such a policy
greatly tempts the military
establishment to use the
equipment so generously
supplied by an unsuspec-
-. TKCAr4cu:aT:EJ-i3
, ting nation ' . '
If the military stabilizer
is" removed because the na-
lion may ' fear for its
biological survival: then
the national economy wilt
have to be restructured to
compensate for the loss of
this . long ; lived and
dangerous ; ' economic
monster, . ' '
WHITE HOUSE STAFF MERSSERS HONSHU!
: Black members of the White House .staff wore recently honored for their achievement in
government, at a reception in the Sanr Rayburn House Office Building In Washington, D. C.
They includedlffSIvin Bradley, senior policy advisor to the President; Thaddeau Garrett, assis
tant to the vice president for domestic policy; and Thelma Duggin, deputy special assistant to
the deputy director of the Office of Public Liaison.
Pictured (from left): Garrett; Mel Taylor, general manager of Kraft, Inc. Dairy Group; Herm
Wiile, vice'presldent of urban affairs for Kraft, who provided cheese for the reception and
secretary of the Business Policy Review Council, one of its sponsors; Bradley; Arthur Fletcher
ranratantathra of another soonsor: and Ms. Duaain.
United NaT16ns Report
Waiting and Wondering
By Laura Tarks
Amidst gathering world
anxieties about the fate of ,
the world the Mormon ,
.Church leaders, gently but
firmly, came out against
the MX underground
missile systems being plac
ed in their backyard. The
MX system, they said,
threatens Ihc very ex
istence of world civiliza
tion. Earlier the Bishops
of the Anglican Church
allowed that in the atomic
age the doctrine of just :
wars was the doctrine of1
.mad men to be resisted by
the Church and the
faithful.
Civil disobedience
'against the mad men was
'and is permissible. In the
great court yard of the
Anglican Mother Church
' at Canterbury, gold and
purple banners proclaim
"It is the duty of every
christian to fight fox
peace."
Feeling the interna
tional heat, Secretary of
State Haig was forced to
agree to meet with the
. .Russians, some time this ,
year, to start talks on arms -limitations.
The heat came
primarily from West Ger
many, France and Italy
a.
where the youth and other
elements of the population
have taken to the streets
against nuclear arms pro
liferation. The European peace
forces are rapidly gaining
support among all
segments of the popula
tion. This is specially so in
Britain where the conser-
vative government is!
following a policy of j
reducing social services of
all kinds while at the same
time expanding the arms
budget.
In this context, it was!
unsettling to hear the;
Japanese Prime Minister,
announce that his country
would increase its arms
production. This move
will undoubtedly aid those
in Japan who are now call
ing for constitutional
changes to permit full
rearmament and the pro
duction of nuclear
weapons.
The logic of the Reagan
budget, based on supply
side, (economics must rely
maaness about it. In the
days of our national
economic innocence, from
the civil War to the Great
Depression, the repeated
economic crises were in
variably caused by the
oversupply of goods for
which there was too little
demand; prices fell, pro
fits fell and unemploy
ment rose.
When the Depression
hit the world, economic
wise men determined that
the only way to revive the
economy was to put
money into the peoples'
"pockets via public works
and armaments produc
tion. This worked more or
less and the world was
spared another depres
sion. But over time, an
over of money developed,
causing inflation.
Reagan now proposes
to reverse this by cutting
back on public works and
public service outlays,
which- would reduce the
demand for goods and
cause prices to fall. But
now he also proposes to
encourage the production
of ;more goods with
various incentives to
business, the demand for
which would come from a
three-year tax cut and a
greatly increased arms
budget. The net result of
AFuimi(w duration lessening of in-
economic policies, tO nation rillP frt inrrpoH
. 1 ! . 1 w . UOWU
worK. LiKe me arms race, production and
Reagan economics has
falling
i"
Av- Jl 6
Look Ma, no commercials.
HBO doesn't have time for commercials. We're too
busy featuring over 65 different movies this summer.
Box office smashes like Smokey & the Bandit (I&II).
And early evening family films like Journey Back to
Oz, Disney's Candleshoe and Return from Witch
Mountain. Plus made for cable specials. Over 10 hours
of programming every day.
And what you see this summer is as sensational as
what we show in the fall. Unlike the network reruns.
So get ready to see summer TV like you've never seen
it before. Without those annoying things you have
seen before. Commercials.
GALLrlTOPA-Yl
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"Services of worship in
Remembrance of the
Children in Atlanta" will
be held on June 10 and
June 11 in the Durham
County General Hospital
auditorium, for the
employees of Durham
County Hospital Corpora
tion. The services are.
scheduled ai 10:30 a.m.,
2:30 p.m., ( p.m. June 10.
ami y a.m.. June 11. All
interested persons are cor
dially invited to attend.
Special guest speaker
will be the Honorable
H.M. "Mickey"!
Michaux, U. S. Attorney.
Reverend William W.
Easley, St. Joseph's
A.M.E. Church;;
Reverend Charlene Kam
merer, assistant minister
at Duke - University;!
Reverend Layfayette Max-'
well, Mount Zion Baptist i
Church, Apex; and.
Reverend David L.,
Massey, Northeast Baptist
Church, will be delivering
the homilies.
Also assisting in the ser-,
vices will- be Chaplain ;
Elizabeth T. Wood,;
Durham County General
Hospital; Reverend!
i Haywood Holderness.i
i Westminster Presbyterian
Church: Sister Darlene!
I Orega, Lutheran Chaplain
j at Duke University; and
( Reverend George F. Neal,
J Covenant United
Presbyterian Church.
Special music will be by
Mrs. Arleen Hedgepeth,
accompanied by Mrs.-Lisa'
Hedgepeth. . !
.. A candle light ceremony
will be led by Mrs. Thelma '
B. Brown and Fred White
of the Durham County,
General Hospital staff.
This will include the nam
ing of each one of the
dead or missing children
and a candle will be
lighted in memory of each
child, followed by a tape!
recorded message from,
Mayor Mayn ard Jackson :
of Atlanta, Georgia. ,
The service will be con
cluded with the distribu
tion of green ribbons, for
those who desire to wear
them by Mrs. Elaine G.
Leathers, also of the
Durham "ounty General
Hospital staff.
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