The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1881-01-20
The Building Association.


]. w. McClung, of st. Paul, met our
people at the Opera House, Tuesday
evening, to enlighten them upon the
subject of building and loan assOcia-
tons. He is the Secretary OF the same
at st. Paul. and has been intimate with
all its workings from its inclpiency at
the above place, and is familiar with its
every detail. lie had blackboard up
ON which to illustrate its practical re-
suits, and as the old saying is, Figures
won't lie" he demonstrated to the sat
isfaction OF the majority, how the labor
ing man, woman or child, by investing
small sum each month, finally secure
to themselves comfortable home. The
establishing of these associations, Mr..
McClung says, are not in the interest
of the capitalists, but directly in the
interests of the labOring and poorer
classes. The most comprehensive way
to bring the matter to the understanding
of those who were not present, is to il.
lustratc by an example.
Surprising ;l:at yon subscribe for five
shares of the stock, which entities you
to $1,000 stock; you pay on that stock
IS per month, or 81 pei, month on each
share. You keep these payments up,
say for eight years, which is about the
length of any series, and you are then
entitled to draw out your $1,000, tor
which you have in reality only paid
$500, but the other $500 is tor your
share Of the profits. You want to build
shortly after taking stock and don't
want to wait eight years, what must you
do. The board of directors meet rcgu
larly each month, and 81 on each share
of stock Of all the members is paid in
each month, and if there are 5000 shares
then there will be $4,000 each month to
loan. The directors at their monthly
meeting find this amount Of money on
hand to loan, and call for borrowers.
There may be two or three want that
amount, and the one who gives the most
for 1t gets it after giving the proper Sc
culity. For instance, A. b. and C. are
the borrowers, A. offers $50 per share
bonus, b. offers $50, and C. $50. C..
being the largest bidder gets the money.
Surprising that c. has five shares, equal
to $1,000 stock, $50 bonus on each share
equals $500 bonus on five shares, this
deducted from his $1,000 leaves him en-
titled TO 5000 cash for which he has only
paid probably $40 or $50 for, but he
must keep up his payments each month.
But another feature Is, the stakeholder
is not confined to building, he Can Dor
row the money for any use; a merchant,
or mechanic can borrow it to use in their
business. One holding stock can put
it up as collateral and borrow money on
it, and there are many Othar means by
which stock in such an association will
prove advantageous to the holder which
we would like to mention if we had
room.
Some say what good will it do US to
borrow money to build when we haven't
il lot. This is II small obstacle, but can
he easily removed with the assistance Of
our lot owners, and we understand that
one of the latter will sell lots to those
who occupy tie above mentioned pre-
dicamcnt, on time at per cent interest
and take Il second mortgage. But the
plan adopted by property owners in
Cincinnati are the most feasible, and we
anticipate the ideas Of Mr.. McClung by
saying that he will at the meeting this
evening wednesday, explain them in
full. 1t is called the Longworth system
of leases. lie leased his real estate to
members of the association for ninety
nine years, renewable forever, with an
appraisal at the beginning Of the lease,
with no re-valuation, the lessee to pay
6 per cent. on the first and only valua-
ton, and all taxes and assessments,
and to have the privilege of huying
at any time at the first valuation.
Mr.. McClung will bring this plan prom
inently before the public this evening,
and especially before the property
owners, and endcavOr to conclusivcly
show them wherein it is to their interest
to adopt the Longworth plan in this
city, and not only enhance the general
prosperity of the city but themselves as
we'll. 1t is undoubtedly the most bsnc-
fetal proposition that was ever devised
toward providing homes for the labor
ing classes, and we sincerely hope that
by our next issue we may be able to
note the establishing Of such an assOcia-
ton in our midst, having the hearty CO.
operation of those whom it was cstab.
lishcd 10 benefit.