New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-07-26
new KIND OF
LOAN CERTIFICATES
Represent Adoption of
Modified Form of Amor
tizatiOn Plan.
N. Y. MORTGAGE AND
SECURITY co. SERIES
System Provides for an Annual
Reduction of Sum Borrowed
on Real Estate.

Special interest has been aroused IN
real estate and financial circles by the
announcement by Harry A. kahler'
president of the New York Mortgage
and Security Company, Of the introduc-
ton Of two new features IN the issu-
arce Of first mortgage certificates
They are among the provisions under
which the New York Mortgage and Sc
curity Company has put out new
series of D per cent guaranteed hrst
mortgage certificates.
One OF these provis ons represents
the adoption in modified form OF the
general principle Of amortization so
long followed with success by the great
mortgage banks OF Europe. while me
other. giving 10 the mortgage cert1n-
cate holders the right, after tnree
years. on sixty days notice, TO caIi IoI
payment from the deposited mortgages
Is intended to provide a means for pre-
venting the necessity, in any emer-
gency thereafter, of selling cer'lh-
cate in the open market.
Mr.. Kahler. who is the president o.
the New York Title Insurance Com
many as we'll as president OF the Ne"
York Mortgage and Security Company,
explained the new ideas adopted IN the
latest series OF certificates. He SAID:
"In a new series OF per cent guar
anteed first mortgage certificates the
New York Mortgage and Security Com
panv has added two features not here
tofore embraced in such issues By the
other well known mortgage companies.
The basic principles on which hrst
mortgage certificates have been issued
in this city are generally understood
and their security and convenience
recognized. Not only have investors IN
these certificates found them always
secure against loss Of principal, but IN
terest has invariably been paid on the
date due by check mailed TO registered
holder This promptness OF interest
payments and the convenience OF beng
able 10 buy certificates in any round
amount have brought them into IN
creasing favor. Frequently Il IS lmpos-
sible for an investor 10 ind mort
gage for an amount equal 70 the funds
lie may wish 10 invest.
lie is thus delayed in investing ms
money. with consequent loss Of inter
est. whereas nc may a. once purchase
mortgage certificates for any amount
that nc requires IN multiples OF SlOO,
and interest will begin Immediately.
The mortgages securing these certlh-
Gates are OF the same general character
York savings banks and trustees Tor
estates and arc deposited with the Co
lumbia Trust Company IS trustee Tor
the certificate holders The deposltsry
must always hold mortgages OF par
value a. least equal 10 the amount OF
mortgage certificates outstanding. Inc
final security IN this series OF certlh-
Gates does not depend on the sound
ness OF single mortgage. but IS as
tributed over all the mortgages held
by the depositary.
While other companies have iol-
lowed in whole or in part the plans
Just mentioned. the two features added
By the New York Mortgage and Sc
curity Company are, first, a require
n ment that all mortgages deposited for
this series OF certificates shall pro-
vide for annual payments in reduction
OF principal. and, second. that the hold
or OF a mortgage certificate may. after
three years. call for payment from the
deposited mortgages.
"Tnc FIRST Of these provisions IS an
adoption. IN modified form. Of the
general principle Of amortization so
long followed with success By the great
mortgage banks o. Europe.
"Our certificates mature IN ten years,
but We do not intend that every loan
shall provide sinking funds or serial
payments sufficient 20 amortize all
loans within 50 short a time. In Eu-
rope the amortization period IS IRE
ouently fifty years or longer. Our
company Obligstes itself 20 require 4
pfOvision for some annual reduction OF
principal in every mortgage IN order
that the margin Of security may be
constantly increased. or 20 cover IN
forcseen depreciation. II any should
occur Serial payment loans also act
TALLY encourage borrower 20 pay OF
their mortgage. particularly small
mortgages on homes.
"Tbe second added provision giving
the mortgage certificate holders the
Tight, after three Year, on sixty days
notice, 20 call for payment from the