Wilmington daily gazette., 1874-02-28
lhe Usury Laws.


In nearly all the States efforts are making to
nlter and amend the laws in regard to loanlng
money, and in some Of them it is proposed TO
abolish al laws restricting the barter OF money
The matter is now before the Legislature of Mary
land, and the slme embarrassment presents itseii
that our own Legislature had to encounter al It's
last session. In Delaware there has never been
Legislature elected with majority that was will
ling TO change The old rate Of six per cent per
annum, or to go far MS TO allow contracts to be
made for the loan oil money on note OF mortgage
In referring to this matter, tue Baltimore San, OF
yesterday says
"Capitai, under our present system, Instead OF
being attracted here, goes elsewhere, except when
illegal interest Is obtained Tor II, WINE others,
disposed to comfly with the laws, send their
money out Of the State, where it will obtain
Letter profit, notably to New York, where the lie
gal rate is seven per cent. There are very few
States beside Maryland in which six per cent on
ly is prescribed the legal rate. Yet this bill
does not propose 10 change the legal rate OF slx
Der cent, but makes it lawful TO contract 10 pay
higher rate by an instrument In writing between
the parties. In fact, contracts are now made Gu
abing the lender TO exact as high rate from Inc
borrower as the demand and supply or the mar
ket will justify
The usury law is dead letter in both town and
country and the business interests OF ths State
az Well vi The Giles as OIL tnose ScNeTai IoChlues
which sometimes oppose il. demand its modlhca-
tion; aud yet the Legislature has hitherto refused
to sccede TO the demand. Among other argu-
ments ia t4vot vi leaving borrowers and lenders
tree ~ make such contracts as they may choose
il IL urged that there is 40 standard by which to
determine what shall be the value of money, for,
like vi commodities, its value 1ucuates, aud bor
roweI5 will never give more than it is worth, nor
W Il lenders take less. The intention of the bill,
lowever, is simply to prevent evasion of the law,
ut.A IN oil mo p n
commodity. Capital naturally seeks those locali-
Ties where the most can be procured 10y it, just as
grain goes to the market where most is paid Tor
U, just now, however such Is the abundance OF
money il the business centies Of the country that
1t hardly commands the ordinary legal rates of
interest, and on short loans il does not Thus
the effect of the regulation OF its price by the law
of demand and supply is Shown now largely IN
favor OF the borrower and the propriety OF SO
modifying our laws rs that, while the general le-
gal rate remains at per cent., parties will be
privileged to contract in writing ior a different
aud higher rate, is very strikingly illustrated
There seems 10 be just as much difficulty to get
money OH mortgages or on loans for one, Two and
three years in Philadelphia and New York as
there is in Delaware. Whether the rate Of inter-
est here is the real cause oil money being scarce,
We Of course cannot say il no doubt has some
influence; and if the rate was seven instead OF
six per cent money that is now used elsewhere
might possibly remain at homo. But even this is
doubted by those who have weighed the matter
carefully. in this city ten per cent, . the usual
bonus in the sale and transfer o Arst-class six
per cent, mortgages and sometimes as much as
twelve per cent bonus Is PAD. But we have seen
advertisements very frequently u the New York
papers offering to dispose OF good real estate
mortgages at discount Of 20 per cent, and in
the Philadelphia papers advertisements have re-
Gently appeared offering mortgages well secured
on real estate at Is per cent. discount. 1t would
therefore, seem that the increase CT interest &c
seven per cent, which is now paid in New IoiE
does not have the effect TO enable parties 10 make
permanent loans at lower rates than are paid IL
Penpsylvania or Delaware AS 4 general thing
people like to loan their money at home, and
would do so, we think, rather than go abroad fol
the slight difference. But the great difficulty il
in The fact that loans cannot be made legally ant
safely at home for a rate above six per cent wheI
it is known that money is bringing six per cent
from the savings banks, when deposited on call
i've per cent. ON 80 days notice, and about on,
per cent. month is paid for frst.class paper
on the streets
The "Odorless Monopoly.
Tho Commercial continues 70 lament the les