The Richmond Virginian. (Richmond, Va.) 1910-1920, 1914-12-06
Industrial. and
Real Estate
The Curse Of the Mortgage
How 1t May Become a Blessing-A Farmers Belief
h, NORM

Congress will undoubtedly do
something definite to help the credit
of farmers. The most pressing need
seems to be to relieve farms and real
estate of some Of their burdens.
What is called Amortization"
seems to he very practical method
OF enabling he farmer to rid himself
and his farm of that intolerable
mortgage burden. This plan Is quite
common In Europe, and 1t will UNI
doubtedly be tried in the United States
before long. For that reason a brief
explanation and illustration as to
what amortization really means and
how II will benefit the farmer WHO has
q mortgage on his farm NAV serve z"
prepare him for the good times that
are surely coming.
Amortization al applied TO farm
uortga ges means the extinction OF the
debt by It's gradual reduction. Many
farm mortgages call for or Z per
cent rate Of interest payable every six
months. The time comes around regu-
lariy ana the interest must be paid.
Most ci as know that from experience.
But he principal--that is. the amount
~ the mortgage indebtedness--is not
iessened by the payment OF interest.
The debt remains the same. All our
surplus energy is expended in paying
1l2t the interest on the ushi.
Under our present system mortg-
age is milestone hung on our necks-
Perhaps t'lis would not he so bad II IL
we're all. But this is not the whole
case.
Mortgages are written for short
periods-for three, FIVE, or seven years
Then come the renewal of the mortg-
age. new papers to be drawn. perhaps
a higher rate of interest. commission
charges. attorneys and registration
fees.
These numerous and expensive items
the borrower must meet every few
wears, They tie the farmers hands go
that he IS unable Ia remove the mortg-
age milestone from around mis- necn
1Ie farmer takes II with him To the
grave or heaueaths II AS a hurdeusome
heritage to his heirs Thus the mortg
age not only Trir7ds the farmer. but
Il keeps him grinding and tolling with
i, 20 his life Journeys end,
The amortization mortgage aims TO
etno all ;'ais In the first place II
leaves the farmers hands free. An
amortization mortgage Is written for
seventy five years. The only expense
IS the initial charges and these are
made az light as possible,
The rate Of Interest In moderate, and
not Subject tn change. In Europe In
terast rates on amortization mortgages
range from t-2 to S rer cent---sei-
dom IL ever. higher Tsais gives the
farmer chance 70 save little out
of his net Profits 10 pay on the fnortg-
age debt. The amortization plan helps
IN two ways: f11 You paw a little or
the debt every six months: fsa the
amount of interest al every payment
81 sra fually being reduced
genuine amortization mortgage
cannot he called IN by the banker or
private lender-raat Is, the mortgage
must run the length OF time called for
in the document, no matter how
anxious the creditor may be 70 en-
harrass the farmer by calling In the
lean. But, on the other hand. the
farmer '1as the privilege Of paying
any amount on the debt over and
above the regular percentage called
for in the amortization mortgage.
This places every adva ntage where II
ought 10 bon the side OF the debtor.
and not with the creditor. In other
words. t'se amortization mortgage Is A
benefit and protection to the debtor
clas@---scmethinE which IL sadly need
ed In the United States and other
SO called advanced" nations.
The advantages OF this kind OF
mortgage over straight per cen,