The Ottawa free trader. [volume] (Ottawa, Ill.) 1843-1916, 1872-09-07
BUILDING ASSOCIATIONS
Their History, General Plan of Working.
Advantages, &C.
BY j. o. HARRIS.

|
| BY J. o. BARRIS.
! There seems to be- at this time Il general
desire to know something about Building As
soc'ations, and having given the subject some
study, | rise to explain"
HISTORY.
Building and Loan Associations have been
known and established in Europe for a period
OF about sixty years-in this country "A little
less than forty years. They are recognized
ana protected by law in about two-thirds of
the states in the Union, but are more numer
GUS in Pennsylvania than in any other state,
there being over $50 of these corporations in
the city of PHILADELPHIA alone, the aggregate
capital par vaue) being over one hundred and
ten millions of dollars.
in England these associations have an in
rested capital of 20,000,OO0 pounds, or saw one
hundred millions of dollars, and not less than
2oo,ooo persons are directly Interested in
them.
GENERAL PLAN
The general plan and mode of operation is
, briefly this: After having duly organized ac-
cordins to law, certificates of stock (the par
! value OF each share being Sl0O*) are issued, and
shae: are usually sseach. but the law Illinois fixes
each stakeholder pays 30 cents per shave per
month on the stock he holds.
The money paid in is loaned every month
to the highest bidder, the association taking
real estate security therefor and the borrower
paying, III addition to his dues, one-tweltth of
the interest every month.
! when an nri,tiou hos ,ocniv,l fr,,, h.,
monthly dues and other sources enough mo-
ney or securities to Amount to 500 for each
share of stock issued, every non-borrowing
member receives 800 for each share of stock
nc owns, and borrowing members receive their
mortgages and notes duly cancelled.
The better class Of these associations issue
stock in series, every 3, 6 or II months, and
thus continue their existence indefinitely, in
stead Of terminating ON the maturity Of the
stock, or say in or $ years, as is the case
when but one series is issued.
INCOME.
The sources income or profit are, st, the
monthly dues; I'd, INTEREST," Sd, premiums
4th, fines; 9TH, transfers; 9th forfetures of
stock
The Monthly Dues are, as already stated,
fifty cents per month on each share.
The Premium is the amount bid for loans.
This amount is added to the sum of money as
tually received, and a note, secured by mort
gage, is taken for the aggregate amount Thus,
if a member wishes to borrow $500, and bids
$50 per 500, he receives $500 and gives his
note for 5000, on which sum he pays interest
at 10 per cent. in monthly instalmcnts.
The Fines are 10 per cent. Il month on all
sums due the association, and are chargcablc
when the member ncglects to pay on or before
the first Tuesday in each month Each dircc
tor is charged % cents fine for absence at the
regular monthly meetings unless prevented
from attending by sickness or absence from
, town.
The Transfer Fees are % cts. per share, ant
are charged when stock is sold and trantcrrcc
from one member to another.
When Il member ncglectS to pay his dues fo1
six months corsecu,iycly he Forfcits his stock
ard all payments thereon accrue to the Asso
I citation, which may resell the stock; Prociae,l
= however, that member who has paid in ad
vance may he allowed to remain in arrears al
equal length of time without mourning fine
, or penalties.
TIE OTTAWA ASSOCIATION.
Among some of the other peculiar feature
r Of our Association are these, viz: Members
r after making twelve or more payments, ma
), withdraw, in which case they will receive a
y the money they may have paid for dues, wit
"A interest thereon ut i per cent.
No one person can hold more than 80 share
J. in his own name.
g Women may hold shares in their own righ
= = and children also, with the consent of the
:, parents or guardians.
= Each stakeholder has but one vote, and II
Il voting by proxy is allowed. thus placing Il
b, on an exact equality, and giving no man
70 combination OF men an opportunity to oppres
d or cncroach upon the rights Of the weaker {
10 poorer members.
!. EXPENSES or MANAGEMENT.
'. The expenses are very light The Directo
i. serve without pay; the Secretary receives sue
al u sum as the Directors may think proper
y give him land this is usually much less tina
is paid by other institutions for similar sc
II. vices0 the Treasurer who must give bon'
II for the faithful performance Of his duty,
n. paid 40 this year; and the Solicitor is pa
I'D by nonnowEns the ordinary fees for makil
er. papers and examining titles.