Deming graphic. (Deming, N.M.) 1903-1948, 1913-04-25
INTEREST RATE BEING
PAID BY THE FARMERS
New Mexico Rate Of 1857 Is Highest
According 10 Report Of BIZ
reau OF Statistics
NEW ENGLAND PAYS SIX
Exclamation Is That Old Settled Sec
tIons Of Country Use Little
Borrowed Money

In March the Bureau of Statistics
Of the Department of Agriculture
mailed nearly 5000 letters to country
hank, of the United States. contain
inc the following request and explain
alton:
This l.urran proposes lo make I'm
inouiry each year concerning the av-
crare rate of interest paid by farm
crs on loans, the reports 10 be- com
pled into averages by States, and So
pnblshed in the Crop Reporter. Il
pnblralon Of this department.. The
purpose of the inquiry is to show The
average differences which prevail IL
the different States and. ~ the IL
ouiry proceeds, Ia show the change
in the average rates from year Il"
year. Il is hoped that You will assist
rs by reporting for your community.
Question |. What is the average
of the current rates of interest paid
,n hanks by farmers for 3 to Il month
loans, CRnlc which will represent
as nearly as possible the average of
all such loans. secured and unse-
cured
Question >. What was the average
for similar loans year ago?
About 90 per cent of the banks re
piled Their replies were tabulaied
and averaged, with the following re
suits:
INTEREST PAID BY FARMERS
In New England q per cent is the
predominant rate for short time and
unsecured loans; > per cent is a com.
mon rate for secured loans. There
is very little variation from year
10 year. In this section farmers are
no, large borrowers. Many CORE.
spondenl> in this as well H. other
sections of the United States com
menl that farmers receive the same
accommodation rs other classes. One
banker in New Jersey observes, how
ever, "Do not overlook the fact that
The overhead expense in dl.rouniing
farmers notes l. about double that
Ot city lirmS: also that very icN
farmers Will keep balance in pro
portion 10 their line al credit" some
banks pay ! per cent, occasionally
more, Oh deposits. In New Hamp-
shire loans made at 5 per cent or les,
secured by real estate mortgages, are
exempt from taxation. \ similar law
'aa been passed recently in Vermont.
a. one goes southward from Mary
land through the Atlantic Coast
States the rate tends Ia increase, eN
"cpt that in Florida the rate average
somewhat less man in Georgia. \
banker IN Maryland, who reports the
interest rate at per cent, writes
Mortgage loans made to farmer
are generally made through lawyer
III addition io their Zee, for prepar
'hy 'Ile papers, the lawyers charge :
per cent for getting them the money
the rate of interest in this section
seldom changes"
Tine from Virginia, reporting th,
interest rate nj per cent, minimum
charge ~, writes: "When the farm
rrS organization comes Ia rs To assist
Them IN the purchase of fertilizer
We usually charge them q per cent
which fertilizer is distributed anon,
the farmers"
a North Carolina banker quotinl
tue average rate between / and ! pc,
cent writes: "ln discountng paper
Tor farmers II rate of , per cent oh
'ains here, especially when the tim,
exceeds six months. II the farmer l.
able To carry u sufficient balance I,
Jus'iiy as low rate as Il per cent
ne always gets loan at that rate
ihe : per cent discount makes hi
loan cost him 3 per cent"
In South Carolina and Georgia tn
rates quoted vary more widely thai
IN the States farther north. the rang
"e'ng mostly 8 to IL per cent. A re
port from South Carolina states
Farmers usually borrow on pledg
VI live stock and cotton crop TO b
made and 80 per cent of such loan
are made in January and Februar
ana mature in October and November
cotton being the ls+sis of credit nm
not marketable earlier than Septen
oer' No short time loans could eve
ne paid, and none are undertaken.
comments Of like tenor were II
eeiVed from the various cotton grow
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