HOUSE PURCHASE DEPARTMENT:
ADMINISTRATION & POLICY
(continued)
Bank Committee: March 19th 1923
1377 The following report of the House Purchase Sub-Committee was presented:
Advances.
Your Sub-Committee have had under consideration the question of the desirability of granting advances on property in which the applicants do not intend to reside. In view of the difficulty of obtaining possession in a good many instances, it has been the practice of the Bank to make advances to a borrower who has signified his intention of residing in the house, but is unable to obtain possession forthwith, and advances have also been made in certain cases on more than one house where it has been necessary for a borrower to buy additional property to obtain possession. These facilities, however, have not been extended to cases where the applicant does not intend to reside on the property in respect of which an advance is desired.
In this connection, an application was considered from the wife of a Mortgagor to the Bank for an advance on a house in addition to the one already acquired by her husband, and, in conjunction with the general question above referred to, the desirability was considered of making separate advances to husband and wife in respect of different properties.
Your Sub-Committee at their meeting on the 16th October last had before them a report presented by the General Manager on the question, consideration of which, however, was deferred. For the information of your Committee, a copy of this report is attached together with an extract from evidence given before the House of Commons Committee when the Corporation Bill was examined, to which reference is made in the report.
Your Sub-Committee are of opinion that such an extension of the facilities afforded by the Bank for the purchase of dwellinghouses would be desirable both from the point of view of convenience to depositors and investment of the Bank funds. They, therefore, recommend that advances should be granted to applicants in approved cases, irrespective of whether it is the intention of such applicant to reside on the property or otherwise.
Period for which advances should be granted.
Your Sub-Committee have had before them several instances of borrowers who have been unable owing to various reasons such as unemployment, illness etc, to keep up their repayments. In several of these cases advances were applied for and granted for a short period of years only, and it appears that had the advances been granted for the full period allowed by the Rules these borrowers would not at present be in arrear.
Your Sub-Committee are of opinion that future advances should be made where the Valuer's Report so warrants for the full period allowable, and they recommend your Committee to give instructions accordingly.
With reference to the recommendation as to granting advances to applicants, irrespective of whether it is the intention of such applicants to reside on the property or otherwise, the Committee discussed this question at some length, and it was:
1379 RESOLVED:- That it be an instruction that advances granted for House Purchase shall be confined to cases where it is the intention or desire of the applicant to reside on the property, and that where an applicant is made in respect of more than one house an advance shall be granted only where the purchase of an additional house or houses is necessary to obtain possession of one for occupation by the Purchaser, and on condition that the houses adjoin, and that the total number of houses involved in the transaction is limited to three.
1380 RESOLVED:- That House Purchase advances be granted in future for the full period allowed under the rules in approved cases, ie freehold houses or leasehold houses not less than 50 years unexpired.
1381 RESOLVED:- That the report of the House Purchase
Sub-Committee, as amended, be approved.
Report of the Manager:
On the granting of advances to applicants who (1) are not in a position, or (2) do not intend to reside in the property in question.
At the last meeting of the Sub-Committee the Manager was asked to report on the above matters.
The position of Housing to-day makes it quite impossible in many cases for applicants to obtain possession of the house they are prepared to buy, although they would reside there if they could get possession. It is the practice of the Bank to grant advances in all such cases, and the Manager does not see how any other course can be followed.
As regards the latter part of the Resolution the Manager is not aware of any case (other than the one reported at the last meeting of the Committee) where an applicant does "not intend to reside in the property in question". There is a question to be answered on each application form dealing with this particular point, and it is always answered to the effect that the applicant intends to so reside. If the applicant stated he did not intend to reside in the house the application would not be dealt with.
This question has been considered on other occasions, and it has always been the practice of the Committee to grant advances only to those depositors who resided or intended to reside in the house in question.
The Rules describe the objects of the Bank as being to "provide facilities to depositors to purchase or acquire a dwelling-house or dwelling-houses". From such wording it would appear that depositors could, if the Committee so wished, obtain advances on houses they had no intention of residing in. To allow this practice to be adopted would, however, be contrary to the expressed intention of the Corporation when the Bill was examined before the House of Commons Committee. The opinion at that time (and since that time it has been confirmed) was that it would open the door to speculation in house purchasing, and would defeat the object the Corporation had in view, viz: to encourage people to become owners as well as tenants. It would not, in the Manager's opinion, be in the best interest of the Bank, to provide any avenue for speculation in this matter, and the Bank should not be a willing party to such a practice.
The Manager is not aware of any demand for such facilities.
Bank Committee: March 17th 1924
1707 The following report of the House Purchase Sub-Committee was presented:
Facilities for Payment of House Purchase instalments at Daily Branches.
Your Sub-Committee have had before them the Report of the General Manager dealing with the question of the payment of house purchase instalments at the Daily Branches of the Bank in addition to Head Office, where the whole of the house purchase work is at present carried out. On consideration of the Report it was felt that it would be a convenience if these additional facilities could be afforded. After taking into account the advantages as well as the difficulties of such a Scheme your Sub-Committee have come to the conclusion that the proposals outlined by the General Manager are desirable and they recommend that the necessary arrangements be brought into effect as from the 1st May next.
1708 RESOLVED:- That the scheme referred to in the foregoing report for enabling the payment of house purchase instalments at daily branches be approved, and the General Manager instructed to take the necessary steps for carrying the arrangements into effect as from the 1st May next.
Bank Committee: April 28th 1924
1738 The following report of the House Purchase Sub-Committee was presented:
Bournville Village Trust.
An application has been made by the Trust that with a view to facilitating the erection of houses the present arrangement of an advance by the Corporation for such purpose should be extended. The Trustees point out that they can offer ample security for the loan and they ask that a sum of £50,000 should be advanced in similar manner to the existing loan of £5,000 and at as low a rate of interest as possible.
Your Sub-Committee are in full agreement with the object of the Trustees and recommend that the Finance Committee should be informed that your Committee are prepared to co-operate in the matter so far as may be necessary, and they also recommend that the Chairman and General Manager be authorised to take any necessary action on behalf of the Bank in this connection.
1739 RESOLVED:- That the Finance Committee be recommended to accede to the application of the Bournville Village Trust for a further advance of £50,000 by the Corporation for the purpose of facilitating the erection of dwelling-houses on the lines of the previous loan of £5,000, this Committee being prepared to co-operate in the matter so far as may be necessary; further that the Chairman and General Manager be authorised to take any requisite action on behalf of the Bank in this connection.
Bank Committee: June 16th 1924
The following report of the Chairman and General Manager with regard to staff adjustments was received:
RE-ORGANISATION OF STAFF.
At the request of your General Purposes Sub-Committee, the Chairman and General Manager have examined the question of staffing as affected by the increased development of the Bank, and particularly as regards the House Purchase Department. At the same time, the effect of re-imposing the taking of receipts for all sums paid out, has been considered. As many of the bound type of ledgers, after five years' use, are practically full, they are being replaced by loose-leaf ledgers, and the experience of Branches where these new type ledgers are installed proves that a considerable saving of time and labour has resulted. Having regard to the fact that this policy is being continued, it is unnecessary at present to make any additions to the staff because of the taking of receipts for every sum paid.
The House Purchase business is substantially greater than was the case twelve months ago, and divided as it has to be under present conditions amongst so many officers does not give one confidence. The facility for repayments being made at Branches does not relieve the congestion of work in the House Purchase Department itself, although it has enabled economies to be effected in the counter staff at Head Office.
The conclusions we have reached are that the House Purchase Department should be concentrated under a Chief Clerk, and it is accordingly recommended that Mr Taylor should resume charge of that Department and thus free Mr Carver to devote more time to the accounts, statistic and various other duties. To succeed Mr Taylor as a Superintendent of Branches it is recommended that Mr Bennett, who was formerly Inspector of Branches, should be appointed.
Other promotions would follow as a result of these changes, and the only new appointment called for at the moment is that of a Junior Clerk. The position will be again examined at the end of the year, when the annual report of the General Manager on the staff is presented.
1800 RESOLVED:- That Mr A S Taylor be appointed Clerk-in-Charge of the House Purchase Department and Mrs S E Bennett an Inspector of Branches; also that the foregoing be approved and the Chairman and General Manager authorised to act accordingly, the position being reconsidered at the end of the year.
With reference to the suggestion that the Bank should made advances in respect of certain wooden bungalows at Northfield, the General Manager submitted the following reports of the Bank's Valuer, and the Royal Insurance Company with reference to the matter.
Report of Frank Wilde (Bank Valuer) dated December 9th 1924
Re Wooden Bungalows at Northfield.
I am pleased to receive your letter of the 8th inst raising the above issue. You will no doubt appreciate that I gave a great deal of thought to this matter before deciding against the recommendation of the Bungalow referred to, as substantial security for an advance by way of Mortgage. I considered this at the time a very important matter having regard to the fact that there were a number of similar Buildings on this Estate.
At one time I thought a small Loan for a short period of say five or ten years might meet the case, but on further consideration I came to the conclusion that personally I should not be prepared to lend money on this class of property neither could I recommend it as good Trustees security.
There is certainly another aspect of the question. When advertising your Bank you make a particular "plank" of your House Purchase Scheme and I have heard several responsible Members of your Committee emphasise this advantage from time to time. However I feel that this is entirely out of my province as a Valuer, it being more a point for your Committee. Further than this there is considerable agitation at the moment with regard to wooden Houses for the relief of the present shortage of more substantial structures.
If your Committee feel that it is incumbent upon the Bank to assist the Tenants of these Timber Houses to purchase the same, I shall be prepared to recommend a short date Loan in order that the Principal and Interest may be cleared off before the Houses show wear and tear, and it must be borne in mind that these in question have been in existence for something approaching ten years.
In conclusion I may say that as a Valuer I should not recommend Timber Houses unless a prospective Mortgagee had stated in writing that he was not averse to this class of security. I would like to point out that this is no alteration in policy, as in August, 1921, I declined to recommend a Timber-built Bungalow in Ley Hill, in respect of which an application had been made to you.
Report of W H Turnbull, Local Manager, Royal Insurance Company Limited (December 9th 1924):
I am in receipt of your favor of yesterday's date with regard to timber built bungalows with slated roofs at Longbridge, and am obliged for your advices in connection therewith.
In reply I have pleasure in saying that we should no doubt be able to insure the bungalows at an appropriate rate, having regard to their construction and other circumstances. I think it would be advisable for our Surveyor to make an inspection, and I will arrange for him to do so without delay, and as promised this morning at our interview, I will communicate with you further in the course of a few days.
After consideration and discussion, it was:
1950 RESOLVED:- That the General Manager be instructed to notify applicants that this Committee cannot see their way to authorise advances being made on this class of property.
Report of the House Purchase Sub-Committee: January 16th 1925
Advances on Corporation Houses.
Since your Sub-Committee's last report, in 51 cases the advances made by the Bank within the limits allowed by the Regulations have been supplemented by varying amounts from the Finance Committee under the Birmingham Corporation Act, 1919.
Appointment of Receiver.
Your Sub-Committee report that, in the undermentioned cases, the Borrower is over three months in arrear with repayments,
and no satisfactory reply has been received to the Bank's communications in the matter. They have directed the General Manager to
inform this Borrower that it will be necessary to enforce the Bank's powers in the matter if satisfactory payments are not made before
the meeting of your Committee.
A Mitchell; 111, Aubrey Road, Small Heath; Total Arrears: £4. 2. 1.
Bank Committee: May 18th 1925
The Town Clerk presented the following report as to the new Regulations and the form of Bank Mortgage adopted thereunder:
New Regulations - Form of Bank Mortgage.
With reference to my report to your Committee on the 20th April last intimating the approval of the new Regulations by the Lords Commissioners of HM Treasury, an amended form of Bank Mortgage to conform with the new Regulations has been prepared, and I submit a print thereof with this report.
In this connection a drafting correction has been made with the approval of HM Treasury in Regulation No 90 (Depositor in arrear), and with the authority of your Chairman the prints for circulation have been amended accordingly. Your Committee are now asked to confirm the action taken in this matter.
The Committee may now consider the desirability of reporting the final approval of the Regulations to the City Council, but in view of the fact that the Regulations are substantially in the form approved by the Council in July 1924, and the Resolution then passed provided for the making of any amendments in the drafting which might be desirable, your Committee may not deem it necessary to again include the text of the Regulations in your Report.
2069 RESOLVED:- That the Report be approved and the action taken in regard to the amendment of Regulation 90 confirmed; also that the Chairman be authorised to arrange for the inclusion in the report of this Committee to the Council, a reference to the final approval of Regulations by the Lords Commissioners of HM Treasury, specifying the amendments which it has been necessary to make in the Regulations since the same were approved and adopted by the City Council.
Bank Committee: November 16th 1925
2171 RESOLVED:- That the following Members of this Committee be appointed to serve on the Finance and House Purchase Sub-Committee for the current Municipal year, viz:
Alderman Lovsey, Councillors Appleby, Gelling, Daniels, Cooper, Wright and Salt, and Mr E Hallas.
and that the following powers and duties be delegated to such Sub-Committee, subject to the confirmation of this Committee, where necessary:
1. To deal with all requisition for supplies.
2. To deal with all accounts.
3. To deal with questions relating to advertisements.
4. To deal with financial or statistical returns.
5. To consider the investment of the funds of the Bank and make recommendations thereon.
6. To consider questions affecting insurances, and to make recommendations thereon.
7. Generally to deal with matters of a financial nature affecting the Bank not specifically referred to another Committee.
8. To deal with matters relating to the House Purchase Department of the Bank.
Report of the Town Clerk: December 11th 1925
Law of Property Act, 1925.
Form of Bank Mortgage.
The above Act, which comes into force on the 1st January next, provides that a Mortgage executed after 1925 shall only be capable of being effected by a Lease for a term of years or by a charge by way of legal mortgage. This provision makes it necessary to amend the existing form of Mortgage. The alterations are slight in extent and are merely formal.