The Oroville weekly gazette. [volume] (Oroville, Wash.) 1905-19??, 1913-09-05

,er 800 bonds. bearing -four per ~. .n.
interest; these are sold at par, 81 '
be realizes $1,000 in money ne pc, ~
,our ner cens:aad ahe-half per cent -
nav operating expenses Of the Dank'
ard be wants to pay enough adoi''ona,
With his interest to pay OH Ms ioan
:. ,uantv.five years, in which case
:. would be necessary for him TO pay
coo 20 semi-annually, or the equi'"-
,ont Of ST. per cent semi-annuai'S'
"A land mortgage association y,
sanized as state institution wo"l
|;at once give its bonds the stana'ns -,
Toto or municipal bonds and they
:vould commahd as favorable rates .,
Interest They would also colliinanu
fne confidence of investors as 'no
[nonds of privately or co-opera'iVei'
organized associations could not pos
siblv do. The objection may be raiseu
| that such plan means that the sta.e
lis going into. the banking business,
EBut such institutions would not carr!
ESSn a COMMERCIAL banking business
Etbey would simply be the INTERMEDIARY
between borrowers and lenders. lhes
would be entirely self-supporting anu
would simply mean that the state nau
t}aken over a fundamental public util-
titv namely, converting farm real es-
uniform, secufe and negotiable FORM
that would be of mutual advantage TO
tboth investor and borrower. II woulo
lbe a matter or prime importance 10
the public welfare because It. would
urovide a means of developing our
Horticulture and increasing our agrl-
cultural production far beyond what
Els possible under our present condi1
1tions. A single state land mortgage
fAssociation located in the capital OF
IA state would be too far removed
ltrom the farmers which it is supposed
ITO serge. To. meet this difficulty a
fbranch' association of the state as
i ;ssociatinn should be established IN
every county ,ieat. The county is the
Ynaturai unit Of such an organization.
GLand titles are registered and taxes
ARE paJd at the county seat, and 1t Is
.tnot So far removed from the farmer
but what he could GO. in person and
Il arrange for his loan. The loans would
tlbe granted, the titles examined and
the mortgages. accepted by the county
Il branch office. but the issuing of bonds
j should. be limited to the state, organi-
!; zation; Such an organization would
/, give the advantages Of Capitalization
i and would standardize the bonds is.
/ sued within a. state; at the same time
Tit would give the advantage of de-
Capitalization in carrying on the bust
81 ness and taking it close to- the in,
5 dividual farmer. -. ~
/ 1.-THE question of possible loss or
t the part of the state on account Of
, bad loans naturally arises. In the
: German Landschaften there have beer
practically no losses since they have
e been organized. The risk of losses
would always depend upon the carr
a with which loans are made and tn
: proportion of the value Of the prop
erty loaned. In most Of the German
q associations the maximum amour
a (aaesd ia.tTq55thtsdsA tha assffsedl yablTS
d when they were first organized tn
e loans were usually limited to one
: half the value. In establishing sucl
g a system as | have outlined It woult
n be necessary for the state to apron
e riate sufficient funds to establish tn,
q system and to provide a reserve func
to guarantee bonds in addition to tn,
h mortgages held by the association
e This initial appropriation to be pait
e back from the earnings of the associa
ton within a reasonable length O
D time. The question of the taxation O
+, the bon1s. the foreclosure proceed
Mgs. the. transfer and registration O.
land titles are all questions intimatel,
connected with land credit system
and questions that should be con.
stdered in connection with any rura1
credit system. 1t state were to un.
dertake the establishment and opera.
ton of.a land mortgage association
as have suggested, I believe it would
be important to its success to adont
the plan Of registration Of land titles
known as the Torrens system. Sew.
eral of our states have already adopt-
ed this system and others have leeis.
lation under consideration providine
for its. adoption. The advantages Of
fhe system are that it establishes be-
You'd a question. the validity Of the
title because after a title has once
been officially registered the govern.
ment guarantees it. It also very
greatly lessons the expense of land
transfer and shortens the time re-
CURED; If state system of land
credit were established and it was