Newspaper article THE JOURNAL RECORD

HRTC Fails to Use All of Financing Program

Newspaper article THE JOURNAL RECORD

HRTC Fails to Use All of Financing Program

Article excerpt

The Resolution Trust Corp. is not fully utilizing a seller financing program advocated by an Oklahoma City man who is chairman of one of the agency's regional oversight boards, two Oklahoma City real estate groups were told Tuesday.

Richard L. Tourtellotte, chairman of the Region 2 oversight board, said the agency has set aside $7 billion for seller financing, but very little of it has been used.

"I thought that was a drop in the bucket, but only 3.5 percent of it has been used," he said during the "Commercial Real Estate Update for the Nineties." The meeting was presented by the Oklahoma City Commercial Real Estate Council and the local chapter of the National Association of Industrial and Office Parks.

A policy of giving cash buyers preference could be one reason for the low usage of seller financing, but Tourtellotte said he is convinced that offering financing at a better price would yield more money for the agency in the long run. At a meeting in Washington, D.C., last week, he said he expressed concerns that more seller financing was not being used.

Lowering the limits may be one way to use the seller financing mechanism to move more properties, said Tourtellotte, who has been involved in real estate development for years.

"We are set to go out of business in 1996. I say that is possible but not probable. But we are now down to the hard-to-sell assets."

He said the Resolution Trust has 2,740 properties in Oklahoma with a book value of $34.9 million. It already has disposed of 1,117 properties with a book value of $105.5 million.

Nationally, the agency has 83,130 real properties with a total book value of $27.5 billion. It has disposed of 35,140 properties, which had a total book value of $6.3 billion.

Tourtellotte discounted the figures placed on the total cost of the savings and loan cleanup. The deputy treasury secretary has put it in the range of $130 billion to $160 billion, but others have placed it as high as $750 billion when interest is added in.

Tourtellotte said stopping the hemorrhaging and getting banks to start lending to small businesses are the keys to the agency's success. …

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