Mexico weekly ledger., 1885-01-15
BUILDING ASSOCIATIONS.
A Good Thing for the Poor Man and
Of Great Practical Benefit TO the
Communities in Which They
Are Operated.

Are Operated.
The following clippings from the
Globe Democrat of the 11th INST,
which will throw light upon this
subject:
How shall l get a home? OF all
questions there is none other so i'm
portant to the truly patriotic citizen
of some means. In no country in
the world do so large a percentage of
the population own their own homes.
The desire for home is the strongest
passion with the great army of thriv-
ing middle-class citizens. The thrifty
mechanic, the industrious clerk, the
fairly successful small shopkeeper
and some parties of even q little
higher social rank are alike interested
in the subject. The object of this
article is to show what opportunities
are afforded in this direction in St.
louis by building associations organ
lied under the State law.
In Eastern cities building societies
have been in operation many years,
Philadelphia being credited with the
formation of 400 such associations,
and the greater portion of the city
having been built up with comfortable
homes by persons who have made
these Institutions a savings bank, 20
to speak, for their small earnings. In
other cities their success has been
equally marked, the benefits ~accruing
mainly to the poorer class of citizens.
who have became freehoiders by the
self-imposed duty of paying a dollar
or W each month. Experience has
taught, that the habit once formed of
saving this small amount, is seldom
departed from, wen by the common
laborer with a family to support. As.
sociations that encourage such efforts
! are conducive to thrift, sobr;ety,
economy, and independence. They
assist In making poor men better cit.
liens and property owners in thei'
own right, and in creating a commu'
nifty III which communism will not be
tolerated. The building association
comes to the relief of the mechanic
clerk and laborer, and enhances the
taxable wealth within the circuit O.
its operations. What men of this
class ordinarily pay for rent will fur
nish them with a house to live in
that a be called their own in eight
years from the time they become
members, provided they have a piec,
of ground to build on.
AS REVIVED IN ST. LOUIS.
In ST.. Louis these building associa
tons are practically a new feature
only two or three being in existence
prior to the enactment of a State law
passed two years ago, under which
fourteen have been instituted and ar,
now in operation. All those organlz
ed under. the new law are practlcall,
the. same in the main features. Ever
six months they are required to pub
fish a statement, verified by the oatl
of the President or Secretary, set
ting forth theI' actual financial condi
ton and the amount of property ant
liabilities, and the Secretary must ais,
deposit a copy of the statement witt
the Secretary of State.
The following example will give
general idea Of how the business i
conducted: A member holdin,
shares representing 50. 900, and own
ing a lot valued at $500. can procur
a loan of 50. 900 to build a house ur
on the land, giving Il deed of trus
upon the reality TO the Association
and turning his stock over also a
additional security. 1t goes withou
saying that the borrower must pa
his monthly dues on the stock all th
same until it is paid up.
THE SOURCES OF PROFIT.
The principal profit to the associa
ton is derived from the privilege t
borrow money that is disposed of ev
cry meeting night to the highest bid
der, 10 per cent being the averag
amount paid, hut anxious borrowers
really and eager to build, often pay
ing as high as % per cent. premium
On the amount of money secured. T
illustrate this more fully, when com
petition between members for a loa
is strong, one party, rather than de
fer his present opportunity, ma
agree to pay 5000 for the loan @
!, $1,000, and. being the highest bidde
would get the accommodation, o
which he would be called to pay Al
annual interest of 6 per cent. L
such q case the borrower would hay
the use of $500, and his Indebtedness
Of 5000, for the premium, would b
charged to his account at the rate O
$40 a year; that is, assuming tina
} the society would wind up in tie
years. If the borrower cleared hi
loan in five years, the annual interes
would cease and the expense of hi
premium would be reduced to 500
Parties who do not borrow simply pa
monthly dues, their stock being cred
tied in the meantime with its pro rat
of association profits until the share
become of par value, when the or
ganization winds up its affairs.
!, PRIVILEGES.
From the semi-annual statements O
these associations it would appea
several of them have loaned out nor
money than they received. Thi
comes from the custom of antlcipa
ting monthly dues and selling th
privilege of borrowing the next frs
money in the treasury. A privileg
having been purchased, the transac
ton goes of record on the associa
tons books, whereas as a matter O
fact the borrower has not yet receive,
a dollar of the principal. The Ger
tainty of his getting the full benefi
of it in due time seems to he unques
toned, as it is asserted these institu
tons have a banking credit equal t,
their total monthly income from dues
The borrower, however, seldom i
ever sees a dollar of his loan, for tn,
reason that the money to pay for hi
building is paid out under the super
vision nf tho oScnoiofion ~ tbo b,,lJ