The Weston leader. [volume] (Weston, Umatilla County, Or.) 189?-1946, 1916-09-29
FEDERAL FARM LOANS
MEAN CHEAP MONEY
Low Interest and Long Time Are
Features Of Rural Cred
II System.

The Federal farm loan act, popu
larry called the "Rurai credits law,
was signed by the President an'
became q law on July II. 1919.
The primary purpose Of this act u
10 promote agricultural prospert,
by enabling farmers 70 borrow mon
sy on farm mortgage security at I
reasonable rate Of interest and fol
relatively long periods Of time. II
attain this object. two faFm-mort
gage systsms are provided, "a A
system operating through reglona
banks, and CD . system oper'
a,ing through ioInt-stock lans
banks.
40 attract money 70 tho farm.loal
hsld the act provides methoc
whereby those who have money 4
lend can iind safe investment In The
form Of dsbentures or bonds. Of
small and large denominations. To-
susd by he banks and based on ths
security Of mortgages on farm lands
These two systsms are 70 be un.
der The general supervision Of > Fed.
srnl Farm Loan Beard In the Treas.
ury Department, composed Of ths
Secretary Of the Treasury, ~ chair.
man ex ofielo. and four members
appointed By the President. Ihil
board has authority 70 appoint sp.
praiseFs. esamlnars. and registrars
who viii b public osi'elaia.
Federal Laad.Bsnk System.
undsr The Federal land-baAk sys.
tenn tas act provides for Federal
land banks which make loana, fol
the hrst 10 months exclusively
lhrpugh local national tasH.Ican -.
sOclAtions composed pf borrowers.
These ssociataons shall be share.
holders 10 she hanks, and IN that
way the members who are the bor-
rowers win share in the profits oi
sns tank. The money FOR the loanA
u to come partly from the capital o.
the banks and partly from the sale
by tho banks Of bonds secured b.
first mortgages on farm landH. TINS
act defines strictly the purposes for
and the conditions under which
leans are 10 BE- made. and requires
that the rate Of interest charged on
farm loans shall not exceed six per
cent per annum.
Twelve Federal Land Banks.
The United States shall bs dl.
vided Into IL faTm-loan districta,
and Federal land bank with . sub
scribsd capital stock Of not lsss than
s76o.00o. each share 80 shall b
sssablisGsd In zach distsics. Each
federal land bank may establish
branches In lea district. Within
30 days after the capital stcck 10 Of
fersd for sale Il may Be purchased ai
par BY anyone. Thereafter. the
stock remaining unsold shall b.
bought by the Secretary Of the
Treasury for the United States. ],
Il provided, however, that the Gov
srnmant shaIl not receive any diyi.
dsnds on Ito stock. Ultimately, II ID
Intended that all the stock IN tho
banks shall bs owned BY the assoei-
Asions of borrowers, and provision
tharsfcrs 10 made In the law for
THANKSGIVING the original stock o.
par 10 these associations.
Farm-Loan Associations.
The aet provides for the creation
of LEGAL national farn-loan sssocia-
tlons through which Il 10 contsm.
platad that the Federal land banks
shall make their loans. In the
event that 4 local loan association
Il not formed In any locality within
4 yses the Federal Farm Loan
Board may authorize . Federal land
bank 10 make loana on farm land
shrouSh approved agents. Ten q
more persons who own and cultlvats
farm land qualified as security fos
\ mortgage loan under the act o.
Who are about 10 own and cultivate
such land, may form such On assc'
citation, provided the aggregate O
the loaas desired by the member
ship il net less than $4,000. Each
member must take stock In his as
sociatlon to an amount equivalent
10 s per cent Of the amount he wish
a. TO borrow. This stock the asso
citation holds In trust as security tol
The members individual loan. tn
association, IN turn, when appiyini
for money from the bank, must sub
scribe for stock in the bank 70 ~
ameuns equivalent 70 8 per can't o