The Waxahachie daily light. [volume] (Waxahachie, Tex.) 1894-current, 1917-01-30
nlEnTnal 4 llrl = !.
some oF BENEFITS
Of FARM LOAN lCl
WAYS IN WHICH THE NEW sYs'
TEN AiDS THE FARMER IN
FINANCING BUSINESS.

lson OF the facilities created by the
lfederal farm loan act. which was
passed last summer. II will be easier
lin the future for the farmer to Sc
Icure money To make needed Inn
provemsuts or for the purchase OF
Hive stock. and II will be easier also
Ifar the landless man to purchase a
liam. according to recent nublica-
Iticn of the department OF agriculs-
lure Farmers Bulletin 1927 entitled
aHow the Federal Farm Loan Act
Igenefifs the Farmer
The federal land banks established
lunGer this act will stand ready at all
Iffmes. ii Is expected, to lend money
Ito farmers on farm-mortgage secar-
Ilty. The interest charges will be
mot more than 9 per cent, nor more
THAN per cent above the rate paid
Ion the bonds sold by the banks. II
l4fa per cent bonds should be is
Issued, therefore. the rate charged on
lloans would be 5sa per cent or less
There will be no commissions or
bonuses. The loans viii be made for
Iperiods OF time ranging from 5 to
i40 years. thus doing away With the
trouble and expense of frequent re-
lnewals.
The payment OF a certain part Of
1.-THE principal annually or semi-an-
anualls. with the Interest. will be re-
Equised. The total payment. inciud-
linz the interest. will be the same for
leach year. and Will be just large
len0ggh 50 that the entire principal
lwiil be paid off at the end OF the
lpeYioa The annual payment thus
ireaaired TO pay off loan Of $1,000.
with interest at 5 per cent. In 20
Years, is 1924
/ After a loan has run 5 years the
borrower. will be permitted 10 pay
loft the whole amount, ii he desires,
ION any interest date. or to make
partial payments in addition TO the
Irregular installment.
| The requirement Of installmant
payments on the amortization plan,
las outlined above. will serve, first.
Ito cultivate the placing Of thrift III
the borrower, and second. To make
possible the placing of the loans at a
lower rate OF interest, since the grad
iual reduction of the principal con-
Istantly improves the security for the
UNPAID balance. The privilege Of
soptional payments after the first five
Years leaves the borrower free To
discharge his indebtedness before the
lend Of the loan-period, If he finds il
lconyenient to do so.
The federal land banks viii per-
form three important services. III
jThey will convert the security which
farm mortgages afford into ne
gotiable form, known as farn-loan
Iboads ~ They viii furnish adj
lditionai security for the protection
lof these bonds, through their capital
and surplus, and thus make the
ibonds more attractive 10 investors
(S5 They will sell the land bank
lbonds in the open investment mar
lket, which, for obvious reasons, the
ismaH farmer could not reach to adj
vantage
The bonds are 20 be issued in de-
nominations ranging from s25 to
81 900, and it is expected that the
bonds OF small denomination Will
encourage saving through their APP
peal to individuals who have not
been in the habit OF making inveat-
ments. The bonds viii be secured
not only By farm mortgages deposit
cd in trust with a government official
fthe registrar for the land-bank dis
trlet1 hut aleo, as indicated above.
by the capital and surplus OF the
twelve land banks.
10th mortgages and bonds will be
Iexenpt from all forms OF taxation,
Farmers who wish 10 obtain money
from the federal land banks viii or
dinarlly be obliged 10 form local loan
lassceiations. and 10 get their loans
Through these organizations The
local loan associations will improve
1.-THE credit Of their members and re-
gdnce lhe cost OF their loans through
1.-THE performance OF certain definite
Iserviceg, among which are the follow
ling The committee sailed the loan
Ieommittee' OF the association viii
lapprafse the property offered az Sc
scurity and approve all applications
for loans which are sent to the land
blank The secretary-treasurer Of the
Iassociation will transmit the papers
aud carry on all correspondence with
the land bank relative to the loans.
HFfsgs, ..essFsmts.s, s.fstI ,.4ts.rat ~. a. :.