The Raymer enterprise., 1914-03-26

ioh uoHsy duFautase0uSly ana eco
nomically is an important question.
1t may not be so important as good
marketing but 1t is important enough.
His loan should be on terms which
meet his occupation and his financial
resources. II he cannot get these
terms from his banker he will
naturally try to get them elsewhere
The question is will the banker force
him to seek loans elsewhere, or will
he meet the needs OF the farmer.
There is little doubt that the banker
could give longer time on safe per-
sonal paper. There Is little doubt
that he could arrange for long time
real estate mortgages. When farmer
borrows 10 buy a farm and gives a
mortgage for the loan there is no rea-
son why IT should not be long time
amortization mortgage permitting re-
payment in annual or semEannual
payments extending over ten, twelve
or twenty years.
Gilt Edge Security.
A good first mortgage on real estate
running for considerable period Of
time is recognized the world over as
a gilt edged loan. Financiers are ac.
customed to advise II as the safest In.
vestment for trustees. widows and
others who are not able to pass upon
the character of miscellaneous invest.
ments.
The president OF one OF the great
life insurance companies makes the
statement that his company in its his
tory OF forty-six years has loaned
Sl33,S3S,5i9H to 75,l02 farmers, Sc
cured by mortgage on 11,462.3 acres.
the average loan being sl,7S2. The
net loss after paying all costs, fees,
assessments and penalty interest
rates was ourteen-hundredth OF one
per cent This is substantially the
history of all properly organized farm
land mortgage business. Some $780,
100000 in farm mortgages are carried
by our life insurance companies-an
amount equal to G5 per cent. of the
total farm mortgages shown By the
census.
If farm loan for three years is a
good loan, one for ten or fifteen or
twenty years is good too, but no
American bank makes these long
loans, Why? We have never been
able to get any adequate answer to
this question. The general response
Is an unsatisfactory one, 1T isn't good
banking to make such long farm
loans" which is another way Of say
ing what We have said before. that
the city banker will not meet the
needs Of the farmer borrower.
There seems to be therefore no rea.
son why this fact that a long time
farm loan is gilt edged loan should
not be taken into account in fixing the
interest. II is not possible that the
Interest on these loans should be near
the rate which Is received upon bonds,
either municipal or Industrial. The
city banker will investigate fully the
integrity and earning capacity OF
every factory that wants a loan. Is
there any reason why the American
banker should not put himself in a
position TO investigate the honesty and
earning capacity of the farmer who
needs money, thus permitting him to
capitalize his character as do bankers
abroad? On the whole after looking
over the situation at home and abroad
It Is not surprising that the farmer
sometimes suggests that bankers
might well studs their own activities
rather than TO be butting in upon the
farmers business.
Over here in Germany the bankers
we're formerly as slow as those of
america are now to meet this demand
for rural credit. So cooperative
credit came and 1t came to stay. 1t
does the work and il does IL well.
The question that is up in America
is simply a question as to whether or
not the American banker is going to
insist that the American farmer solve
his own difficulties or whether he,
the banker is going to solve it for him
and be his financial hacker.
Mortgage Loans In Germany.
A cooperative loan on long mort.
cages is no new experiment. One
hundred and forty years ago the
Landschaften were organized In Prus-