The Caldwell tribune. [volume] (Caldwell, Idaho Territory [Idaho]) 1883-1928, 1915-04-30

There appeared in The Tribune OF
September 18th, last, an article on
loan companies which propose to fur
nish cheap money to farmers and
others. This article calls attention to
methods which have been employed in
different parts of the country. We re-
publish the article because the time
seems opportune.
A company has been organized at
Boise for the purpose of providing
money at "a low rate Of interest. The
reader of The Tribune after reading
the following article can compare the
methods of this company and the
methods which are condemned. Ii
the plans of the Boise company are
sound and practical this article will
aid it. If those plans are unsound or
impractical the article will serve a
most useful purpose. In any event it
can do no harm and may awaken a
wholesome spirit of inquiry
The article which we printed in
September follows:
Warning Against Cheap Loan Scheme
Some one recently remarked that
it was astonishing how hard some
men were willing to work in order to
make dishonest living. The field of
rural credit is already producing a
number of examples. Certain COM
panies are actively at work promising
farmers cheaper money than anybody
else is able to get on equally good
security The eagerness with which
some are accepting the bait is one in
dication of the need there is for a
sound system of rural credit. 1t is
not wholly the fault of the farmer
who is taken in. A great deal of men
tai energy, combined with marvellous
skill, is expended in preparing soul
compelling circulars which seem to
promise the farmer everything, but
really promises him nothing. If as
much thought and skill were exercised
in trying to convert sinners, we should
be very near the millennium.
Stripped of verbiage and words
which darken rather than enlighten,
the scheme is essentially as follows:
Such company offers to lend you
money on good security at, say, a per
cent interest and to allow you to re-
pay the loan in easy monthly install
ments on the amortization plan. This
sounds alluring. and, if you are not
too persistent in asking what you are
to get and when you are to get it, you
sign an application for a loan on
these favorable terms. In few days
you receive from such a company a
contract for the loan for which you
applied. The contract which you re-
ceive is duly signed by the officers of
the company Then you realize that
the application signed by you and the
contract signed by the officers of the
company together constitute valid
contract, and that you are now in for
it:
Under the terms of the contract
you are to begin at once paying of
the debt Of say, $1,000 at the rate of
$40 a month, but you have not got
your $1,000 yet. Moreover, you do
not know just when you will get it.
The only thing you know is that you
have got to go right on paying $40 a
month You have. however, the pro-
mise that whenever the company has
the money to spare, you will get your
loan. Another way of saying the
same things is that when your turn
comes, you will get it. This means
that such a company has not got the
money now, and that there are several
other gentlemen whose turns come
before yours. AS fast as the COM
pany gets money it lends it out to
these men each in his turn. When
your turn comes, if the company lasts
that long, you will get your money.
Now, where does this kind of com.
pany get the money which it is 60