It was the kind of congressional press release that brings yawns from most parts of the country. But in Southern California, where Democratic U.S. Rep. Jerry Patterson is seeking re-election, its message came through loud and clear to the powerful savings and loan institutions.
Issued by Patterson's re-election headquarters in Santa Ana, the release said that the Federal Home Loan Bank Board (FHLBB) "is expected" to announce "shortly after the Nov. 7 election" a "regulatory change which would expand alternative mortgages and housing startes in California."
To the thrift industry, the phrase "alternative mortgages" means relief from what it views as the burden of having to offer home-buyers long-term, fixed-rate mortgages.
In California, state-chartered S&Ls began offering so-called variable rate mortgages about three years ago. In that time, the interest rate of those mortgages - which is tied to an index published semi-annually by the FHLBB's San Francisco office - has varied in only one direction - upward.
The message in Patterson's press release was the FHLBB's Washington headquarters soon would allow federally chartered S&Ls in California to offer variable mortgages like their state-chartered competitors.
An amendment to accomplish the same thing was introduced by Patterson in the last session of Congress. It barely passed House and Senate banking committees, but it never reached a final vote.
"I've been told by FHLBB Chairman Robert McKinney," Patterson's release continued, "that because the amendment had such significant support in the . . . committees, he is interpreting his support as a 'green light from Congress."
But a spokesman at the FHLBB voiced surprise at Patterson's prediction of a post-election announcement.
McKinney himself was out of town; however the spokesman quoted from a speech he delivered Oct. 15 in which he promised to "continue discussions with Congress . . . before making any final determination" on alternative mortages.