The Cape Girardeau Democrat. (Cape Girardeau, Mo.) 1876-1909, 1893-04-29
MORTGAGE BILL VETOED.

the Credit of the State-Would Not Help
the Debtor ClaSS, but Would Tend to
Make Future Loans More Burdensome:
JEFFERSON CITY, April Gov. Stone has
returned the mortgage hill'' passed by the
lhlrty-Seycnth general assembly. This
measure In which widespread interest was felt,
and the veto message of the governors will be
OF general interest. Gov. Stone. after quoting
sections 7J19 and 700 OF the Revised Statutes,
which the bill intended to amend. says:
Under the provisions Of the existing law in
all cases where real estate Is sold hy the trus-
tees under powers conferred by deeds OF trust.
and Is Fought in at the sale by the cestui que
trust or his assignee. or any person for him. it
Is subject 10 redemption by the grantor. his
executors administrators assigns At any
time within one year from the date Of the sale
on In" payment of tie dctt and interest secured
~ me deed OF trust. and all charges incident to
making the sale.
The l Ill Under consideration proposes that
when real estate is sold ty the trustee without
lcreClohure In court II shall be subject 10 re-
GtmptiOn ty the grantors or his executors. ad-
mnistrators or assigns, at any time within one
year from the date Of sale. upon the payment
or the del l. interest. costs. taxes and expenses
incurred In preserving the property up 10 the
time Of redemption. deducting therefrom any
net income received during the year from the
property ~ the pur, haser.
a' far the provisions of section 1019, Revised
Statutes. and the provisions OF the hill are
SUI sialtially the same. But the bill contains
these further provisions: ~ That there shall
lc no riCht OF redemption in any case where
the mortGagor or owner Of the equity wrong
fully withhOlds possession from the purchaser
Tor thirty days after demand in writing: and
81 whenever real estate is sold by the trustee
without foreclosure In court the sale shall OPP
crate as an a. solute dis harxe of the debt Sc
cured. The first of these proposed changes Is
In favor OF the creditor. in that the right of re-
demTtion is destroyed IL possession OF the
property is withheld ly the debtor for thirty
days att"r sale and demand for possession: the
Sc Ond Of the proposed changes is in favor OF
the del tor. in that IL provides that where the
NnFf 10 OIL lN-f
closure in court Il shall operate rs Q complete
satisfaction OF the debt.
II this ! i'll should ecome q law 1t would not
anect or operate upon existing deeds OF trust.
The remedy sui sisting when a contract Il
made II Z part OF its obligation 5nd II can not
lie SO impaired Us to lessen the value OF The
contract. The deeds OF trust already out
Standing a. rule authorize the sale of the
property covered hy them on breach OF the con.
uiflonS OF the deeds Under the law ~ II now
stands. creditor in case Of sale is required 10
credit his debt by the net amount Of the puf-
chase money received from the sale think
statute now passed sui seluent to the sale Of
an existing decd. providing that in case sale
be made under the terms OF the contract and by
virtue OF its powers it shall operate TO satisfy
and eNtinguiSh the deht. without regard
to tn" amount actually hid or received as the
proceeds Of the sale. would be violative OF the
constitution IL IL was sought to apply its provi-
sions to such existing deeds Hence. II this
hill should Re approved and placed upon the
statute looks. IL would apply only TO deeds OF
trust and contracts executed after IL went into
effect What would be its effect on the enforce
nlent OF future contracts: Two ways are pro-
yidcd in the hill for fOrclosing deeds of trust:
tb fy foreclosure in court: 80 by a sale made
by IN" trustee under the powers conferred upon
him by the deed. In ease of foreclosure in
court no right OF redemption Is given, and in
such cases tn" sale does not operate to satisfy
the del [. but the creditor will be required only
TO credit his claim 10y the amount actually re-
ceived from the sale. The result then
would re that sui stantially all deeds Of trust
would he fOreclOscd In court. What good would
bat. a. II.
lay the sale until the foreclosure proceedings
could he trought to a conclusion. Ordinarily IL
would require from eight to twelve months to
secure judgment Of foreclosure and sale un-
Grr execution. BY foreclosure therefore. 1t
would require from eight tn twelve months
longer time To effect a sale Of the property than
would he required II the sale should be made ~
the trustee SO far as can see this delay coiA
81 tuteS the only benefit that could accrue to
the debtor under the provisions of the bill.
But. on the other hand. he would lose all right
OF redemption whatever. and all the largely in
creased costs Of the foreclosure proceedings
would fall upon him. II this bill should he
come law. future deeds of trust would no
doubt invariably contain n provision to the
effect that in case OF foreclosure attorneys
fees should he taxed as costs in the case and
charged AGAINST the debtor and made a lien
on his property. ANY possible good that
might come to the debtor Is therefore OF
set. II not more than Offset. by the hardships
that would accrue TO him as the result Of fore
closure Where money is loaned and secured
IL "A mortgage on real estate the incumbrarce
can only he released by the payment of the
de!t. II the market value Of the property
moriGacrd Is in excess Of the debt secured
there will rarely he any occasion for fOreclOS-
urc. since, when the debt natures now
loans can. generally speaking he readily
negotiated. Under the present law. where
sales are made by trustees and the property il
purchased by the cestuique trust or on his
account, the mortgaGor has year within
whlch TO redeem provided he executes
lond, to he approved Ey the circuit court or
clerk. that h" will pay the debt and costs
within that period. Now, If any property sold
has market value equal to or in excess Of the
amount secured. there Is reason why the
DEBTOR can not execute such bond or negotiate
new loan to meet his expiring one. Taken all
In all II seems 10 me that the provisions of the
Till would not substantially better the con-
dttion of mortgage debtors. On the other
hand. II would tend In 1?ny instances. un-
assume that in cases w.icrc the mortgaged
property in value largely exceeds the debt Sc
cured. and the debtor fails to renew or replace
the loan. the creditor might direct the property
To he sold by the trustees. In such cases the
creditor. becoming the purchaser, would be en-
titled TO possession within thirty days. and II
possession should not he tiyen accordingly the
debtor would lose all right to redeem But there
are many instances where the mortgaged prop-
crty Is not sufficient to cover the debt Sc
cured. and often in such cases other personal
or collateral security is taken. Now in cases
OF this character. the creditor would be COM
peeled to foreclose in court. thereby being de-
laycd and sometimes endangered in the collec-
tiOn of his debt and the debtor and his securi-
ties he huricned with attorney fees and other
costs incident to foreclosure. Aside from all
considerations Of this character however. I
seriously doubt whether laws of this descrip-
tion do not ultimate in more harm than good.
Unfortunately Our western people are borrow
ers. The mortgage Indebtedness Of the western
states is very large though IL is less in Missouri
than in most OF the surrounding states. II
is also true that We are compelled in 4 very
large measure to obtain money owned by peo-
pie residing outside OF the state. chiefly In the
northeastern states. This strikes me as an alb
normal condition Of things: hut so IL is what
ever the cause may be. and as to that IL II not
proper here TO inquire. These mortgages tha,
and day after day Many of them are being
paid on. hut very many Of them IL IL necessary
to renew. Interest rates in Missouri are con-
siantly decreasing. not rapidly, but the ten
OF measures such the un-
der consideration must tend inevita-
bly, 10 increase the interest rate and the dfff-
Guilty OF making loans. Instead OF making the
path easier 10 the dettor class. fear such
measures would tend to multiply their diff
cultics. And as to those who are in debt al
ready see no reason for increasing their bur-
dens or lessening their opportunities OF bor-
rowing money whenever they need to do so. In
the conduct of their business merchants grain
producers and dealers. those who feed and
ship live stOrk and others who have constant
occasion TO make loans on comparatively
short time. would find real estate less desra-
BILE security TO offer to the banks. and those who
wished to rorrow outside capital on longer time
would meet with the same difficulty, finding the
borrowing capacity Of their property decreased
and the interest rate of their money increased.
Missouri has retained n high rank among the
cOmmonwealths of the Union
believe the best interests of the state will
he sui served l.y withholding my approval Of
this bill. Respectfully.
WIN. J. STONE Governor