FHA TITLE I CLAIMS PAID AND RECOVERIES* ON DEFAULTED NOTES Number of payments prior to claim.-The number of installments paid by borrowers prior to default leading to payment of claims by FHA is shown in Table 61 and Chart XXVIII. Cross classification of number of payments made by the original terms for defaulted notes shows that borrowers on longer-term notes appear to default as soon as borrowers for shorter terms. Of the total notes on which claims were paid in 1949, nearly one-fifth were amortized by 6 to 10 installments prior to default, and almost one-fifth were amortized by 11 to 15 payments. Slightly more than 1 in 20 of the defaulted notes was in a default status with no payments made. The 1949 distribution differs substantially from the default experience of 1948. Whereas in 1949, about 24 percent of the defaulted cases were notes on which less than 6 payments had been made, in 1948 as much as 43 percent fell within this category. The number of cases with 11 or more payments, however, increased from 33 percent in 1948 to almost 57 percent in 1949. TABLE 61.-Claims paid on Title I loans: Percentage distribution of total claims paid by duration of loan and number of payments made prior to default, 1944 and 1947 Reserves, 1949 1 1 Data based on claims paid during February, May, August, and November, 1949. Less than 0.05 percent. PAYMENTS MADE ON TITLE I LOANS PRIOR TO DEFAULT RESERVES Section III ACCOUNTS AND FINANCE The accounts of the Federal Housing Administration were converted from a cash to an accrual basis as of June 30, 1949. The figures in the financial statements for 1948 and 1949 have been prepared on the accrual basis and have been shown, with certain exceptions, as of the fiscal year rather than the calendar year as heretofore. Since Section II of this report, Statistics of Insuring Operations, will be continued on a calendar-year basis to coincide with the housing year, those statements in the Accounts and Finance Section which are coordinated with the statistical statements shown in Section II will remain on a calendar-year basis. Gross Income and Operating Expenses, Fiscal Year 1949 Gross income for fiscal year 1949 under all insurance operations totaled $63,983,953 and was derived from fees, insurance premiums, and income on investments. Operating expenses of the Administration during the fiscal year 1949 totaled $23,400,904. This left $40,583,049 to be added to the various insurance funds. Cumulative Gross Income and Operating Expenses, by Fiscal Years From the establishment of FHA in 1934 through June 30, 1949, gross income totaled $355,527,750, while operating expenses totaled $194,046,869. Gross income and operating expenses for each fiscal year are detailed below: NOTE.-Operating expenses include charges for depreciation on furniture and equipment. The above income was derived from the following insurance operations: Title I (property improvement loans), $39,772,146; Title II (home mortgages), $216,721,022; Title II (rental housing projects), $6,895,146; and Title VI (war and veterans' emergency housing), $92,139,436. An analysis of gross income by fiscal year under each insurance fund is given in Statement 1. STATEMENT 1.-Income from fees, insurance premiums, and investments under Titles I, II, and VI, by fiscal years, 1935–49 Minus figures caused by adjustments relating to prior years. In addition, cash recoveries and other income in the amount of $18,927,195 have been collected on claims paid on insurance granted on and after July 1, 1939, and credited to the Title I Insurance Fund. 1.722 22, 418 109, 801 221,869 2,276, 103 1,823 231,066 5,515, 636 9,095 53, 906 795,875 2, 152, 828 10,005 69,828 182, 910 322,607 344, 106 514, 810 7,991, 585 8,788, 022 8, 510, 971 10,797, 347 23,066, 771 24, 971, 132 31, 569, 019 4,762,018 1,807, 551 92, 139, 436 STATEMENT 1.-Income from fees, insurance premiums, and investments under Titles I, II, and VI, by fiscal years, 1935-49—Continued The current fiscal year is the tenth in which the Federal Housing Administration has met all expenditures for salaries and expenses by allocation from its insurance funds. The amount which may be expended for salaries and expenses during a fiscal year is fixed by Congress. Under the terms of the National Housing Act expenditures for the operation of each title and section are charged against the corresponding insurance fund. The amounts charged against the various titles and sections of the act during the fiscal year 1949 to cover operating costs and the purchase of furniture and equipment are as follows: Salaries and expenses, fiscal year 1949 (July 1, 1948, to June 30, 1949) Government Corporation Control Act Section 501 (b) of the Housing Act of 1948 (Public Law 901, 80th Cong.) made the Federal Housing Administration subject to the Government Corporation Control Act (Public Law 248, 79th Cong.). The first of the annual audits to be made in accordance with principles and procedures applicable to corporate transactions, as required under Section 105 of that act, was performed by the Corporation. Audits Division, General Accounting Office, as of June 30, 1949. |