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Mortgages tight
Higher interest rates discourage homehuyers
THE BATTALION Page 7
WEDNESDAY, MARCH 5, 1980
Texas high court justice
will speak here Thursday
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United Press International
Texas financial experts are as per
plexed as the general public by the
current home mortgage squeeze and
most won’t even hazard a guess as to
when the crunch might end.
Officials from savings and loan
associations, mortgage companies
and banks across the state say cur
rent sky-high interest rates — hover
ing about 13 percent — are being
rejected by potential homebuyers
not only because prices are steep but
also because of general anxiety about
national and international problems.
Weldon Fox of Metropolitan Sav
ings in Dallas says the phones simply
stopped ringing whn interest rates
hit 13 percent.
“We’ve got so much uncertainty in
the world,” he said. “Inflation, the
T
Shuttle runs
extended for
Silver Taps
By JERRY MAZE
City Reporter
Shuttle bus service will be ex-
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Hnn’taimW tended until 11:30 p.m. on the Tues
days of Silver Taps to accommodate
off-campus students wishing to
attend.
Brad Smith, vice president for stu
dent services, said the student sen
ate has been searching for ways to
increase student awareness of the
, ,i a ■ ceremony. Silver Taps is the final
tribute paid to Aggies who have died
while they were Texas A&M stu-
aikurs persons, j
i as leaving tk dentS ’
“There have been fewer and fewer
people at Silver Taps,” Smith said.
“Students do not seem aware that it
is going on. Perhaps the increased
service will help. ”
threat of recession, the energy crisis,
international problems, high in
terest rates plus the price of homes
today. People don’t know who to
turn to. ‘Why should I take on a loan
that high?’ is what they’re asking.”
Apparently answers haven’t been
forthcoming.
The slowdown, which began in
earnest in September, was dramatic
enough to reduce total mortgage
money loaned in 1979 by more than
20 percent compared to 1978,
according to a year-end report by the
Austin-based Texas League of Sav
ings and Loans.
Using data supplied by a sampling
of the largest savings and loan asso
ciations across the state, the league
reported mortgages totaling $6 bil
lion, down from $7.6 billion the pre
vious year.
Construction loans for new single
family homes also plummeted —
nearly 50 percent — with $71 million
worth closed during 1979 compared
to $137 million the previous year.
Perhaps even more significant,
however, was a similar plunge in
loan commitments (the amount of
loans the savings institutions com
mitted to fund at a later date).
At the end of 1979, loan commit
ments totaled $894 million, down
sharply from the $1,021 billion com
mitted in 1978.
The steep declines in loan com
mitments are a signal that a quick
turnaround of the current mortgage
situation is unlikely, said Durward
Curlee of the Texas League of Sav
ings and Loans.
But Curlee declined to offer any
predictions as to when the situation
might begin to impove.
“Things are looking bleak,” he
said. “Is the borrower going to say,
‘No, I can’t, or won’t, pay 13 percent
interest?’ How long is he going to
keep saying that? If he decides (not
to buy a home) then what is he going
to do? We just don’t know.”
Fox said if he had been asked late
last fall or early winter when im
provement might occur, he would
have predicted a turnaround by June
or July.
Asked last week, he answered, “I
don’t know when now. ”
One mortgage company executive
in Houston said predictions about
the current economic situation were
impossible because “the old logic,
the old parameters” just don’t apply.
“All indications are that it’s going
to get worse before it gets better.
ii is h
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heir parents®
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ident said. “I'nik
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ents to see. i
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‘ girls had sup
wall themsehf ’
et us repainttW;;:
i e cause, they au:.
| Gene Oates, chairman of the shut-
. tie bus operations committee, said
1 u eu atl0 “, > the new idea will be tried out at the
:■ gu\s ysantedl nex t Silver Taps to see if the extra
1 ns 1 u • " ll service draws enough response to be
, . , justified.
igulabonssaylk
nms may be pr Oates said the shuttle bus commit-
sion of the areap tee and others involved are deliber
ation is made; ating ideas for increasing bus service
hours, but action has been held up
ie told the girlsS by increasing costs of operation and
ov<*r the darnar time required for planning.
The extra hour of service will cost a
jus pain ng projected $18 per bus, Oates said. To
appropriae f our buses will cost $72 each
ituation, ncc
lefaced; theyWj
ilation. I don’ttl “We are looking all the time for
ust paintingovHi areas of greater need,” Oates said.
“However, except for the scheduling
change of Silver Taps, shuttle bus
Service will probably remain as it is
next semester.”
When necessary. Silver Taps is at
10:30 p. m. on the first Tuesday of the
month in front on the Academic
Building.
Now you know
United Press International
NEW YORK — Inflation and the
rising price of gold have sparked pur
chases of expensive gold watches,
according to a major distributor of
gold watches imported from Switzer
land.
A spokesman for the North Amer
ican Watch Corp. said that 2,500
Concord watches were sold in Amer
ica in 1979 at prices ranging from
$4,400 to $60,000. Prices on a new
companion watch for women, which
is 35 percent smaller than men’s
watches, start at $4,900.
S
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A good all purpose guitar with well
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Layaway
BRYAN, TEXAS
ve
How much worse? Who knows?” he
asked.
Jim Anderson of Texas Federal
Savings and Loan in Dallas echoed
the uncertainties about predictions.
But he said he would be surprised if
there were a break before January
1981.
Despite the downturn across the
state, Texas has fared far better than
other areas of the country, officials
said. They attributed that in part to
out-of-state residents being transfer
red to Texas — with their employer
often picking up the tab for ex
penses, including those associated
with selling their old home and
buying a new one.
The federal government’s decision
to override state-imposed usury ceil
ings also has had an effect by making
more mortgage money available. But
state financial experts say the effect
has only been minimal because of
customer resistance to 13 percent in
terest rates.
The override’s effect also has been
minimized because the unpre
cedented interest rates it allowed
have priced out of the market a large
percentage of potential home buyers
who cannot afford the increased
monthly terms that go with 13 per
cent interest rates.
“It’s made some money available, ”
Anderson said. “Before there was no
money. Now if you’re willing (to pay
the high interest) you can get the
money. But few people are willing. ”
Or able.
Texans who can’t afford current
the price of today’s loans increasingly
have been turning to assuming out
standing loans on the home they
want. Sellers eager to unload also
have begun taking notes.
Anderson said it was not generally
known that Texas law provides that
mortgages made at an interest rate
above 10 percent can be repaid with
out penalty charges.
A speaker presented by MSC Poli
tical Forum might shed some light
on the works of the Texas judicial
system.
Charles Barrow, an associate jus
tice of the Supreme Court of Texas,
will talk on the topic, “Is Our Judicial
System Working in Texas?” in Texas
A&M University’s Rudder Tower,
Thursday.
A court justice since 1977, Barrow
is a Baylor University graduate and
currently a member on two promin
ent judicial committees.
Barrow’s talk is set for 12:30 p.m.
Thursday in 701 Rudder. Admission
is free.
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