The commonwealth. (Scotland Neck, N.C.) 1896-1929, 1917-01-16
HOW TO GET A LOAN UNDER THE
FARM LOAN ACT
By Frank R. Wilson
Of The Farm Loan Bureau
Written for the United Press

WI1GGCu lOl CAlGOu 1Coo
Watching ton, Jan. l6.-The right to
borrow under the Farm Loan Act is
is limited to farmers and prospective
farmers. Farmers or perspective farm
esr who wish to borrow group them
selves into Farm Loan Association,
each association being composed of ter
or more farmers, and each association
starting with a minimum Of at least
$4,000 Of loans. To join, a farmer
merely makes application to the sect
treas. Of the loan association in his
community. If none has been organ
lied he should get together the requir
eG number Of borrowers and organize
an association. The Federal Loan
Board at Washington will furnish, on
application, blank form OF articles
OF association for such organizations.
these articles and sign them and the
secretary treasurer makes affidavit
thereto. This association then elects
five or more directors and the direo-
tors then elect president, vice-presi-
dent, secretary treasurer, and a loan
committee Of three members. AS soon
as the Federal Loan Bank of that dis
trioo is ready for business it will pro-
vide this local association with sd
ditional blanks including an appijca-
ton for a charter and blanks for the
loan committee to use in the work Of
appraising the farms. AS soon as the
loan committee is elected it may pro
ceed to appraise the farms upon which
mortgages are to be placed. It's report
which must be unanimous, must accom-
pany the signed articles Of the associa-
ton and be filed with the Federal
Land Bank Of that district.
When this is done the appraiser of
the Federal Land Bank will come to
inspect the security offered and accept
or reject the report Of the loan com
mittee.
No one farmer may borrow more
than $4,000 nor less than $500. No
National Farm Loan association NAV
start with aggregate loans less than
$4,000
If John Smith, farmer, desires te
borrow $4,000 he invests in the stock
local loan association one-twentieth OF
this amount, Or $100.
His association then invests thi
money in the stock OF the Federal Lane
Bank, enabling it thus to increase it
capital so as to make another loan O.
$4,000 to some other farmer The Dor
rover gets his investment back whe,
he pays off his loan, or he may turn
in as the last payment on his loan.
Farmers are required to form thes
organizations so that they will event
ually will control the Federal Ian
Banks. Each loan association votes i
the election Of the directors Of it's Fec
eral Land Bank. Each association ha
a loan committee which values the Ian
Of it's members subject to the approve
of the land bank appraiser and til
, Federal Land Bank. Each associatio
has board Of directors which ha
] the power to exclude or admit ne
! members by two-third s vote. It
; through this local loan association thu
the farmers invests the money to /
used for increasing the capital stoc
of the Federal Land Banks, and this
j how the farmer comes into possessio
8 Of his own banking system
: Farmers are permitted to borrow u
) to 80 per cent Of the appraised vail
] Of their land and 20 per cent Of t.
! appraised value Of the permanent il
sured Improvements thereon.
. It is not necessary for a borrow,
to be an actual land owner when
= joins, but the landless man must issr
: the borrowed money to purchase lar
j which he intends to Immediately beg
farming. Another chapter will be d
= voted to this feature.