The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1889-03-08
REDUCING THE INTEREST RATE.

There was hot fight in the Minneso-
ia House Of Representatives Saturday ov-
er the usury bill reducing the legal rate
of interest from toto s per cent. and pro-
hibiting the collection of commissions
which together with the interest would
exceed 8 per cent. per annum. There
was a considerable opposition to the
bill, principally against the prohibition
of commissions. A substitute was re-
ported providing that commission of
2 per cent. per annum be allowed, and
also providing for heavy penalties for
violation of the law. The substitute
was not looked upon very favorably,
however, as many thought it better to
do away with it altogether rather than
open the way for perjury. The substi-
tute was lost by a vote of As to AZ, after
which the question of the passage of the
bill itself came up and resulted in its
passage, yeas 30, noes So. Mr.. Barr vot-
ed no, Perrin and Lassow yea, and Mr..
Davis was absent.
~,
simply provides that the rate of interest
should be reduced from 10 to s per cent.
The dispute, however, was over section
2, which is given in full as follows:
Section 2. That section of said chap
ter 66 of the general laws ofthe State of
Minnesota of the year 1879, be and the
same is hereby amended by adding
hereto the following proviso:
Provided, further, that 1t is the intent
and purpose Of this act that no person
shall claim or collect, either by himself
or his attorney or agent, in the form OF
commissions for making any loan, OF
for examining the security therefor, OF
by any other device, any greater sum
than 8per centum per annum on the
amount actually received by the Dor
rover from the date of such loan; and
all bonds, notes, bills, assurances, con.
veyances, chattel mortgages, and all 9th
er contracts, whereupon or whereby
any payment OF money or any indebted
ness is contracted or paid in excess Of
said s per centum per annum in the
shape of commissions, or for services in
examining the security therefor, or by
| any other device, shall be void, as here
in provided. But nothing herein con.
tanned shall be construed to apply tC
money actually paid to any practicinl
attorney or notary public for examining
the title to any real estate and drawing
the necessary bond, mortgage or other
conveyance in connection with said
loan; provided, that the charges are us,
ual and reasonable, and are not intend
ed as cover for usury; provided, that
the payment of one years interest II
advance not exceeding s per cent pei
annum shall not be regarded us usury.
1t would seem that this section would
go far toward taking away the occupa
ton of the money brokers and loan
agents, unless money gets so easy thai
capitalists will be glad to pay the com.
missions themselves. In such case
the provision would of course be a very
good one. But is it not out of the ques,
ton that the Eastern capitalist will send
his money West and loan it without the
Intervention of some well-informed per
son on the ground upon whom he can
depend? And will not the payment
ola commission to the agent cut down
the capitalists returns on his money tc
figure which will prompt him to make
his investments nearer home? viii
this not have but the one effect of max.
ing money close here where it is SC
much needed-in fact, make it impossi
BILE for farmers and others to obtain
money at any price? These are serious
questions which should be thoroughly
investigated before any further step,
are made toward putting the law on the
statute books.