St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1891-08-24

opinion as to which ''plan" is the best
for operating building association, and
upon this Mr.. H. T. McCIung, who has
made the subject a study, in an inter-
view SAYS:
From the time | became secretary of
the st. Paul Mutual Building assoeia-
ton, three years ago, began to read up
the matter, thinking there must be
more popular plan than the Que in use
in st. Paul. | bought all the reading
matter l could find on the subject. and
finally found that the largest and most
successful legitimate company in the
United States was the Mutual Home
and Savings association, of Dayton, o.,
with 81, zoo, 900 assets and 5000 accounts,
operating in a place of 10000 people,
and doing a local business with eX-
penses only & per cent.
1.-The same plan practically is in use
in all parts of Ohio, and its popularity
and success may be Judged from the
large number of associations IN the
state. Some Of the advantages of the
Ohio plan are: The borrower or investor
are not obliged to pay back dues. but
can start any time without paying back
dues from the first of the year. This
allows man to begin saving his money
a savings bank. and is a great improve
ment. A borrower does not have to pay
up several months back dues. The
loans made are payable in monthly in
StallmentS of % cents per 500 per week.
and the borrower can pay as much
more as desired. All he pays above the
stipulated weekly interest and bonus APP
plies on his stock. and thus reduces his
loan so much. Thus borrower can
pay his loan or any part of 1t at any
time with no extra cost. On old plans
a borrower was obliged to continue his
monthly payments nine or ten years,
until the stock is matured, to pay large
bonus for the privilege of eanceling his
mortgage before the stock matured.
The loans on the Ohio plan are ION or
BEFORE" which makes them popular and
enables the companies to loan their
WOney readily. No fines are charged
to the investor under any circumstances
for nOn-payment of dues, and borrowers
are only fined after missing several pay
mentS; and on notification. or II Dor
rover is say, One month in arrears, and Is
notified that unless he pays up he Will
be fined, he can square himself by pay
ing his arrears and also paying as far in
advance as he has been in arrears, and
save fines.
"The general rule in Minnesota is TO
fine borrower and investor 10 cents on 81
If he fails to pay on or before stated
day each month, and these fines are
rigidly enforced, thus making matters
harder for any one who is unfortunate
enough to be in arrears.
The paid-up stock feature of the
OHIO associations is another feature
that Is not very generally used in this
STATE D1ln-lIn CrnQE mt tn pXPRP0
$1,000, is issued to any member whose
stock has matUred, should any such
member desire to continue this invest
ment in place of drawing his cash; or, il
the association has good demand for
loans, to any who should desire to
invest their money. This stock is paid
for, 500 per share, in cash, and draws
its dividends in cash Semi-annually in
place of the dividends accommodating and
compromising as they do on the INSTALL
ment stock. This gives small investors,
who need the interest on their money to
pay taxes or live on, chance to be-
come members.
The main difference in the two plans
is that the plans in use in Minnesota
adopt the main principle that stock
holder must stay in the association I'M
ill his stock natures or pay a bonus to
profits earned if he withdraws. On the
Ohio plan stockholders can come and 90
freely.
Building associations necessarily are
made up of two classes-One class who
invest money, and who use the associa-
lions as a savings bank; the other
class are the borrowers, who must also
take stock when they borrow. The in
veStOrs, or depOSiting members. have
always been easily secured, because the
legitimate associations, when properly
managed, have always paid two or three
times the interest paid by savings
banks. The borrowers have been harder
to get, owing to the complicated form of
the building association loans, where
every borrower is a stakeholder. The
Ohio plan seems to be the plan which
suits, the borrower better than any
other and is to-day the most pop ular and
equitable plan in existence"