The St. Charles herald. [volume] (Hahnville, La.) 1873-1993, 1917-03-17
FARM LOAN ACT.
III. How the Farmers May Take
Advantage of 1t.
BY Frank r. Wilson, federal loan
reau, Washington, d. c.

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| (By Frank r. Wilson, federal loan bu-
reau, Washington, d. c.
Only farmers or prospective farmers
who wish to borrow money may join
the national farm loan associations
provided under the federal farm loan
act. 1t takes ten or more to make
up one of these associations. If o
farmer wishes to borrow he should
find out if such an association has
been formed in his community. If 1t
has, he should make application to
the secretary~treasurer for member
ship. If no association has been
formed, he should attempt to get ten
or more farmers who wish to borrow,
to meet for the purpos1ebf organizing.
The process of organization is very
simple. One of the members should
write to the federal farm loan board,
Washington, D. c., for blank articles
of association. When they have been
received a meeting of the prospective
borrowers should be called and these
articles Of association should be adopt
ed, signed, and acknowledged by each
member. Each member will indicate
the amount he wishes to borrow and
the value and description of the land
he wishes to use as security.
This association elects five or more
directors, and these directors then
elect president, a vice president,
secretary-treasurer, and a loan COM
mittee of three members.
This Is as far as the association can
go until after the federal land bank
OF that district is established. Then,
upon application, the federal land bank
will furnish the local association with
blank application for charter, which
should be filled out and filed with the
federal land bank, along with the ar
ticles of association.
Lands Of Members Valued.
These documents should be accom-
panied by written, unanimous report
OF the loan committee placing a valua-
ton on the lands of each of the men,
bers.
Then the appraiser Of the federal
land bank will come to inspect the
lands of the members and o. X. or
reject the valuation prepared by the |
loan committee.
No one farmer may borrow more |
than $4,000 nor less than 500. No |
national farm loan association may |
start with less than $4,000 of loans. |
Each member joining the local asso-
,iation must buy stock in the associa-
lion equal to per cent of the amount
ne borrows. If he borrows $1,000 he
will get $3.50 in cash and a certificate !
If stock for $50. Or he may make his
oan $1,000 and thus have q net loan
II $1,000, taking as long a time to
'epay the $50 invested In stock as on
he thousand borrowed. This invest
nent is for the purpose of providing
he increasing capital Of the federal
and bank, and the local association
invests 1t In the land bank stock. The
borrower will get his money back
When he pays off his mortgages, and
will get what dividends 1t earns while
is invested.
why iney Are Grouped.
Now, what is the object of requiring
he borrowers to thus group themselves
nto loan associations?
Primarily, that the loan associations
nay eventually own the federal land
anks.
This is a cooperative banking sys.
em, and machinery must be provid-
d for the government Of the banks
ZACH Of the local loan associations has
vote In the election Of the directors
one Of the federal land banks. The
IAN committee, provided by the local
ssocfation, is the agency for the valu-
ton of the lands. The board Of d.
ectors Of the local association admits
rejects new members, according to
leir wishes. But most important Of
II, since this system is cooperative,
he borrowers must provide the money
" the increasing capital Of the bank
and they do this by investing in the
'cal associations.
Loans made under this system maya
Ot exceed 80 per cent of the ap-
raised value Of the land used as Sc
lrity, and 20 per cent Of the ap.
raised value Of the permanent, In.
lred improvements thereon.
Non-land owners may become mem.
srs of an association by indicating
their application what land they
lpect to come into possession of and
yainSt which the mortoooo will ho