Ellsworth American. [volume] (Ellsworth, Me.) 1855-current, 1894-12-13
RENT VS.. OWNERSHIP.
THE WORKINGS OF THE LOAN
AND BUILDING ASSOCIATION.
a PRACTICAL EXAMPLE SHOWING THE
ADVANTAGES OF THE MAN WHO
PAYS INTEREST OVER THE
MAN WHO PAYS RENT.

generally, but that possesses advantages
for the working man and business man
which, properly understood and accepted,
will prove an important factor in the
building up of the city. This organza-
ton is known as the Loan and Building
association.
The loan and building association idea
is no experimental has been tried in
other cities, in every state OF the union,
and proven in actual operation all that is
claimed for it in theory. In the vicinity
of New York villages and towns COM
posed almost entirely of homes Of wage
earners, have been built through the
agency of loan and building associations.
The object Of this article is to show, as
clearly as possible, the workings of the
loan and building association already in
operation in Ellsworth, and the adj
vantages it offers to wage-earners OF the
city to own their own homes.
The stock OF the association is issued
in two series Of shares each year, in jan
uary and July, and no person is allowed
to take more than twenty-five shares.
This stock is represented by deposit
book issued to the shareholder, in which
the series, number of shares held, and all
money paid by him, are entered The
value, when fully paid, is 900 and two
shares are exempt from attachment
hn of hor hnI no
value of his shares is paid to his legal
representatives, and is distributed to his
family in the same manner as money re-
ceived from life insurance. The shares
may be obtained at any time of the seere-
tary at his office, or at the monthly meet
ing, which is held the first Monday of
each month.
These shares are paid for by a monthly
deposit OF Il for each share, the share
holder depositing as many dollars each
/ month as he holds shares, until his
deposits and the profits on the same
amount to 200 each, the average time re-
quired being about ten years. These
month ly deposits must be paid on or
before the monthly meeting, otherwise
the shareholder is subject to a fine of two
cents each month ON each dollar which
he owes.
Any shareholder may Withdraw from
the association by giving thirty days
notice and signing the withdrawal book
at the secretarys office, when he shall be
paid the amount he has paid into the
association and seventy-tiv per cent. of
the profits on his shares.
Loans are made at the monthly meet
ings by the sale Of the money, at auction,
to he highest bidder, but it may be said
here hat the usual amount bid is twenty
five cents, and We believe in no case has
the association accepted a higher bid.
The security for the loan must be first
mortgage of real estate, or the shares
themselves, not exceeding their accumu-
lated value.
In making these loans the directors
show a preference to those who are
borrowing for the purpose of building
homes of their own. A borrower must
have share of stock for every 300, or
fraction thereof of his loan. Wishing
for loan he attends the monthly meet
ing and bids for his money, say twenty
five cents on each share. This is called
premium and is in addition to the interest
at six per cent, and must be deposited,
toget her with the interest for one month,
at the meeting at which he bids.
man desiring loan of 1000 and
holding five shares of stock, bids twenty
five cents per share, his premium is S1.25;
interest, SIS; and dues on his shares, S.
:. -
mont until his shares mature, or become
wort h Il ,o00-when his loan is paid, his
mortgage discharged and his shares cam
celled-but a borrower can pay his loan at
any time, and retain his shares if he cares
to.
The earnings are made up of the
interest, premiums and fines received,
and after deductng the expenses, are
credited to the account of the share
holders every six months, before the
opening OF a new series Thus the
borrower receives back his proportion of
the interest and premiums he has paid.
Perhaps the best way to show the adj
vantages offered is by practical example.
We sometimes hear the argument, by
those who have nothing laid up, that, as
the association requires margin on
their loan, and as they have not that
margin to offer, the association can be of
no use to them; also that they cannot
afford to pay rent and dues at the same
time
Take the case of Jones and Smith for
the term of ten years, both situated
alike, each earning the same amount and
paying the same rent, say = month or
So4 year.
Mr.. Jones finds by small saving of
one dollar and twenty-five cents each
week he can carry five shares in the loan
and building association. He takes the
five shares and in six years finds he has