Phillipsburg herald. [volume] (Phillipsburg, Kan.) 1882-1905, 1889-02-01

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they are for the advantage of the
borrower The can create but dis
tfnst Of our security, and those hav-
ing funds loaned here will certainly
see that they cannot re-loan under so
favorable conditions as heretofore,
and viii collect as fast as loans ma
ture and re-invest elsewhere
Third, it will decrease the amount
the investor viii loan on a given Sc
curity It is not reasonable to pre-
sumo an investor will loan so near the
value of the security, fit takes three
/ or four years to foreclose and sell the
4 property, during which court costs,
taxes, insurance and interest are en-
larging his claim, as he would if the
time was One-third or one-half as
long. He must have a margin to
cover these years of accumilating in
terest, court costs, insurance and
taxes, and a margin to cover the de-
probation through probable neglect
and by reason of lower market value
and a further margin, to enable him,
should he bid the property in after
I all these years of delay and expense,
to price it low enough to effect a sale
and yet return him his claim with in
terest, taxes and costs.
Fourth, it will increase foreclos-
ures and deprive many of their homes.
The effects of-the stoppage of new
money, the Withdrawal of funds now
invested, the reduction of the percent
age Of amount loaned on a given Sc
curity, will all. increase foreclosures.
+ A farmer may have loan soon ma
turing, say, $1,000, which, under the
+ present law and with the present
supply Of money is perfectly good
and can be readily renewed with the
present holder or even increased; but
! suppose he cannot pay, the holder
wants it paid, the proposed laws are
in force. He cannot borrow, for his
security sufficient a few weeks ago is
now no longer good and foreclosure
/ is inevitable. On unmatured loans
where interest is IN default the credi-
tor cannot show Ieniency, but is fore
ed by this legislation, in order to pro-
tect himself, to foreclose promptly
and terminate the long litigation
which must follow as soon as possible.
Fifth, it will decrease sales and de-
preciate property. Many farms are
now sold on payments Of One-fourth
or one-ffth cash, and the remainder
on time secured by mortgages. Gould
any one afford to sell a farm for say
one-fourth cash down and wait one
year for next payment or interest,
not get it, fOreclOse and wait four
years longer five years after selIing)
before regaining possession of the
property (which he would surely have
to take back and during this time
have interest, court costs, taxes, ETC.,
increasing his claim? Certainly no
one would sell on so small a cash pay
ment. None could buy excepting
those who could pay all or nearly all
IN cash. Sellers would be numerous
and buyers few. The last named
would fix prices. One of the reasons
Of our rapid growth in population
and increase in wealth is that rail
roads and individuals could, under
existing laws, sell land on small cash
payments and be reasonably certain
that deferred payments would be met
or they would recover the land be-
fore the deferred payment with &C
cumulated interest, costs, etc, exceed
ed the value OF the property. The in
creased number of foreclosures, the
inability of property owners to Dor
row so much on the same property as
heretofore, the lmpossibility to safely
| sell on small cash payments viii in
/ crease the amount of property for
| sale, and the fact that those only who
can pay large portion Of the pur-
chase money in cash, can buy, viii de-
crease the number of buyers and re-
! duce values.
The proposal to pass the contem-
/ plated laws has already materially
/ alarmed investors, and they now hes
/ itate or refuse to purchase loans they
would have accepted instantly a few
weeks ago, J.
The above from the Salina Gazette,
we lay before HERALD readers by re-
quest Of some of orr hrsiness men