The southern press. [volume] (Washington [D.C.]) 1850-1852, 1851-12-17

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referred to, are emphatically the poor MAJ
friend:
BUILDING AND LOAN AssocIATIon-Bu
and loan associations originated in Scotland
about thirty-fve years since The first institu
ton Of the kind was established under the "a,
mediate auspices of the Earl Of Sekirk, gen
tleman Of large fortune, and Of liberal and en-
lightensd views. who is said to have devoted n,
little study to the periecing OF this truly phiIan
thropic and noble scheme. Since their intro
duction, they have spread very extensiveI,
throughout Great britain and number, in thai
country aloqe, two thousand and fifty societies
with an annual income, of fur millions sterling
On account of their number, the large amount
OF active capital they employ, and the very ben
eficial influence, they exert upon the industrious
and middle classes, they have attracted the at
tcntion Of the British Parliament, and secured
several special enactmonts in their favor Such
indeed, is the Legislative encouragement and
protection afforded them, that all that is now
necessary for theobtainment of charter on the
part OF new association is simple application
to the solicitor of the Crown
They were introduced into this country about
twelve or thirteen years since, and have operated
very successfully in most of the Northern cities.
have been bnilt up by their exclusive agency /:
in Savannah and Augusta, also, they are now in
prosperous operation. Three associations have
been in existence in Charleston for little over a
year, and have, in that time, invested upwards of
eighty thousand dollars in real estate. Such
sum expended upon this species of property.
has OF course very favorably affect | it-crcat
ing an Increased demand and thereby enllanc
ing its value. 1t has led. also, to the erection
OF number of new buildings, and furnished
many persons with houses of their own, by the
accumulation and Investment of little sums that
would otherwise have tsen dssipated and lost
While apart from the benefits conferred upon
individuals and families, the impulse given to
mechanical and other branches of industry, has
been very considerable. Nothing is now needed
to ensure the complete success of these nsttu
tons, and the entire confidence of the commu-
NIFTY IN them, but the sanction and support of
State charter Nor can we believe that this will
be withheld, when the principles upon which
they are based,are properly understood. Your
attention is, therefore, respectfully invited to the
following brief exposition of their objects and
plan of operation:
The primary object ofthese associations is to
enable every man, to become his o,on landlord,
to secure howe for his family, by simply pay
ing for few years but little more than would
otherwise be expended in rent while, to the
economical and thrifty, they afford the means of
Vcsting their savings to great advantage--to
much greater advantage than in any other
.nown institution. BY thus promoting habits
Of economy and industry, and holding forth to
ndivid lals the inducement to become owners of
eal property-thus identifying them with the
oil and institutions of the State, and increasing
he am, unit of its taxable property-their adj.
antage, in both moral and political point of
Jew, is highly important. AS to their nature
md mode ofoperation
/. They are mutual benefit and stock compa.
lies.
g Each share of stock is one dollar month.
'ad in monthly during the terms of the associa-
ions existence.
3. The entire amouLt paid in each month il
ut up at the monthly meeting of the stockhold.
RS, and sold to the highest bidder or bidders
mong them, at premium. This premium is
educted from the gross amount, and the nsr-c n !
bidding receives the balance; and is required to
ecure the association for the advance by a |
mortgage on real estate equal in value to the mel
amount which he receives
L. A stakeholder is allowed TO bid for 5000 |
N each share he holds; and after he has Dor. |
owed, pays, in addition TO his monthly dues for
bares, per cent. per annum, on the amount for
'hlch he bids. This interest is paid in monthly
it'll the shares.
For instance. Suppose the capital stock of
n association TO be one thousand shares one
thousand dollars will then be paid in and sold
ut each month. Suppose an individual holding
We shares, bids, at a monthly meeting, for the
'hole amount at 20 per cent premium. lie re-
ewes $500, (the net sum after the premium is
educted,) and is required thereafter to paw. in
EDITION to his hive dollars monthly for shares
er cent. on a thousand dolars-which would
70 sixty dollars year, or five dollars a month.
n other words, he pays five dollars monthly for
is shares, and the same amount as interest
,hile the association lasts.
8. The association winds ND when IL ia able
D divide two hundred dollars to each share of
took. The stakeholder who has purchased an
dvance, is debited in his account with the pre-.
lium he has bid. Thus, if he own five shares,
nd has bid for thousand dollars at 20 per
emit, Gas in the case supposed, he receives eight
undred dollars which, in the winding up of the
ssociation is accounted full settement-the
remium being the clear profit of the association.
In addition to the profit derived from pre-
liums, the association, by loaning out with its
ther funds the amount paid in monthly for in
crest, actually compounds interest twelve times
year, while its individual stockholders are paw.
Y but simple interest. BY this rapid mode of
multiplying money, these societies are generally
nabled to wind up in from five to eight wears
never exceeding as far as we have learned
le last named period
The advantages afforded to borrowers bv
'ese associations, are many and obvious. In
] ordinary loans, an individual borrows from
mother party; and in the end pays back more
'an he recelves-after paying the interest for
'rtan time, he is required to refund the prin- q
pal; but borrower from the association rare.
returns more than he receives: He borrows
ON concern in which he is interested, and de-
YES his proportionate profit from the very in '
rest and premium that he pays for the loan I
o great is this difference, that an individual ,
orrowilE from the association even at 40 per /,
mt. prlA1 m, "a very extreme case,) and pay
e an interest besides of per cent, does not t
ally pay as much as the man who bonows in I
'e ordinary way at per cent. To illustrate /,
, individual owning five shares, bids for a
'ousand dollars at 40 per cent, this would be !
400 on the thousand, leaving him $500 net. {
or the use Of these $500 he pays per cent, on d
4 t,xNxyy and I'LL