Herald and news. [volume] (West Randolph, Vt.) 1878-1943, 1895-08-08
estate security, to precipitate the fore
closure of mortgages and to increase
the number Of vacant FARMS

p |
the number Of vacant FARMS
A DEBTOR FARMER.
The farmer members of the legisla.
lures that have considered the repea
OF double taxation at the several times
when it has come up are not fools
in the ordinary meaning Of the word
Without doubt they have voted fol
what they deemed the best interests OF
their constituents. However, it il
quite possible for men Of ordinary OF
extraordinary intelligence to be fooled
part OF the time by specious argu-
ments. OF this nature are all that we
have seen advanced thus far in favor
! of the present system.
i The correspondent was, we surmise,
a member Of the legislature of 'S4. He
gives the sist of the argument which
convinced him that any change in the
law would be detrimental to the very
class it was intended to benefit.
"a Debtor Farmer assumes that
the holders of mortgaged real estate
are at the mercy Of the mortgages,
because the mortgages are mostly
overdue; that the latter live where
taxes are lower than where the en-
numbered real estate lies; that if ii
was proposed to relieve the mortgagor
from any portion of his taxes, the
MORTGAGE would quickly saddle him
with the taxes that it was intended he
(the mortgagee) should bear and that
the debtors lot would be even worse
than now. The latter is expected to
yield under threat of foreclosure. 1t
can readily be seen how forcible such
d presentation OF the case must be to
farmers who have not given the sub
ject considerable study.
Ii is true that many mortgages on
real estate in Vermont are overdue.
LII all such cases the mortgagee con.
iinues the loar because he is satisfied
with his interest and his security. The
loans are not continued after matur-
ity uni IS interest is paid promptly,
excepting when the security warrants
the further addition of interest to the
principal. II is in either case pure
business. The creditor is as well
pleased with the arrangement as the
debtor. At the rate of interest that
banks are paying, loan placed on
real estate, well secured, at six per
cent interest is gilt-edged invest
ment. The creditor would really re-
gret to be paid, unless he had urgent
use for the money, as opportunities
for safe investment at such rate are
not numerous Inasmuch as by far
the larger portion Of real estate loans
are held by banks whose business is
investing where returns are safest and
best, the fear that change OF the
kind indicated in the law relating to
taxes would alarm the creditor class
and cause them to call in their loans
is groundless. But a great many
mortgages are not due. These, by no
manner of reasoning, could be al
fected. Still further, future loans on
real estate would be rs easy to nego-
tiate as at present. II the creditor re-
quired the debtor to pay all the taxes,
then the rate of interest would be
lower, as is the case in other states
where this arrangement is made. The
debtor would gain because he would
not have to pay taxes on the full value
OF the property and pay six per cent
interest besides, as he now does.
The present system creates a ficti-
tious value which bears taxation at the
expense of the debtor II AS mort
gage OIL BIS 81 800 farm is $1,000, A
is taxed for 81 900 and B for ~, 300, q
total of 81, 900, though there is clear
ly only 81, 800 worth OF property. b
is assessed for 81 800, which is $1,000
more than his interest in the farm
amounts to. We have yet to learn
how B is better off by paying taxes on
this value which does not exist than
he would be were this fictitious value
wiped out. But even supposing that
he is, why, we ask, should not the
same rule be applied to every other
debtor? Why should the man who
borrows money ON personal security
be exempted to that amount while the :
man who borrows on real estate Sc
,urity is taxed? If double taxation
IS right in the one case, why not in
.he other
r.. ,tan.. Il