French Broad hustler. [volume] (Hendersonville, N.C.) 1916-1919, 1916-08-24
METHOD OF CONDUCTING
LAND BANKS EXPLAINED.

Nl VI NO4NO 1884,
LAND BANKS EXPLAINED.
IT is no unlikely that the farm loan
hill which Woodrow Wilson's sigma
ture made law the other day will be
| considered some years hence as the
greatest piece of constructive leglsla-
ton in the last half century. Inc
American farmer has suffered greatly
because he has had to pay an outrage
Gus price for the money he borrowed.
CITY brokers have no use for farm
loans. They make their profits out Cd
short term paper, turning over their
none with the seasons, practically.
The farmer must borrow for a long
period. 1t takes years to raise a call
to be a steer and a colt to be a horse.
Some of the machinery which he buys,
such a binder, he can S only a few
days in the year. The remainder OF
the time it is idle. Anyone who read
the article of Clarence Ousley, of the
Agricultural College of Texas. has q
fair idea Of the tremendous burden
placed upon the farmer by the high
price he has been compelled to pay
for money.
The new law and the creation OF
the twelve land banks will make it
possible for him to borrow on COM
paratively easy terms. Here is what
the farmer can do:
First, he must join what is to be
known as a National Farm Loan Asso-
citation, paying in SIS for one of its
shares for each 500 he wishes to Dor
row. He has one vote a share, but
not to exceed ten votes in all.
Next, he applies to the association
for the loan, giving his personal note
therefor secured by a first mortgage
on his farm. If the association ap-
proves the loan, it turns the note
mortgage to a land bank. The land
bank sends the amount of the loan to
the association, which hands the mon
ey to the farmer. No commission.
brokerage or rake-off is charged the
borrower.
! No single loan is to be for less than
$1OO or more than 100000; o less
than five years or more than forty
+ years. The loan must not exceed 60
per cent and preferably should not go
beyond so per cent of the market
value of the land covered by the mort
gage.
The borrower pays, semi-annually,
the interest on his note, plus a. install
nent of the principal. He must not be
charged over 6 per cent interest.
Each National Farm Loan Associa-
ton must have at least ten members,
and it cannot begin business with
less than $4,000 in loans applied for.
1t is illegal, under severe penalties,
for any officer, committeeman or mem
Der to accept any commission, fee or
~perquisite of any kind for granting
any loan. The only paid officer is a
Secretary-Treasurer.
Money car be borrowed by this sys-
tenn in order to pay for agricultural
land. equipment. fertilizers, live stock.
buildings and improvements or to
discharge a prior mortgage.
The land bank may charge the bor-
rowing farmer only 1 per cent more
than the rate it gets On its bonds. This
margin of one point is to owe ex-
penses and profits.
The day of the range is gone. With
its passing We must hereafter raise
our cattle on the farm. That means q
very great amount Of money must be
invested in stock. We are passing,
too, from the age of muscle to the age
of machinery in agriculture. That
means a great amount Of money must
be invested in farm machinery. There
Is need Of better farming methods!
We raise less tan Is bushels of wheat
to the acre In Germany they produce
35. We rob the soil. We do not fer
tilize to the extent we should. A great
amount of money must be invested in
fertilizers. ALL these investments will
bring good profit to the agriculturist.
They will bring profit to the public,
too. Unless they are made the cost
Of living will keep rising. The whole
public is interested in the condition
of the farmer.
Under the Rural Credits law the far
mer a borrow at 6 per cent. In
Germany he can borrow at from 8 ga
to 4 IA. Farm loans there are made
On lower terms than the government
pays for money it borrows.
We have made a start, a good start.
The prosperity of America is bound
up in the successful operation of the
land banks.-Commerce and Finance.