The Leon reporter. (Leon, Iowa) 1887-1930, 1917-01-25
How to Get Loan Under Farm Loan
Act

! By Frank R. Wilson, of the FEEDER
| al Farm Loan Bureau.
! The right to borrow under the
Farm Loan act is limited to farmers
and prospective farmers. Farmers or
prospective farmers who wish to Dor
row group themselves into Farm
| Loan Associations, each association
ers, and each association starting
with a minimum of at least $500, 900
of loans
TO join, farmer merely makes ap-
| plicat ton to the secretary treasurer OF
the loan association of his cOmmun-
ity. If none has been organized he
should get the required number OF
ton.
The federal farm loan board at
Washington will furnish on applica-
ton, blank form of articles for such
organizations. Then the organizers
adopt these articles and sign them
and the secretary treasurer makes al
fidavit thereto. This association then
elects five or more directors and the
directors then elect president, vice
president, secretary treasurer and a
loan committee of three members.
AS soon as the Federal Land Bank
of that district is ready for business
it will provide this local ASSOCIATION
application for a charter and blanks
for the loan committee to use in the
work of appraising the farm AS soon
as the lean committee is elected 1t
may proceed to appralSe the farms
upon which mortgages are to be plac-
ed. It's report, which must be unanl-
nous, must accompany the signed ar
the Federal Land Bank OF that dis
trict:
When this is done the appraiser Of
the Federal Land Bank will come to
inspect the security offered and ac-
cept it or reject the report OF the loan
committee.
No one farmer can borrow more
than SIC, 900 nor less than 500. No
National Farm Loan Association may
start with aggregate loans less than
$4,000.
If John Smith, farmer. desires to
borrow $4,000 he invests in the. stock
of his local loan association one-twen-
tieth of that amount or 500.
His association then invests this
Land Bank, enabling it to thus in
crease its capital SO as to make an
other loan of $4,000 to some other
farmer. The borrower gets his in
vestment back when he pays off his
loan or he may turn it in as the last
payment of his loan.
FARMERS are required to form these
organizations so they eventually will
control the Federal Loan Banks. Each
loan association votes in the election
Of the directors of it's Federal Loan
bank. Each association has a loan
which values the land of |
its members subject to the approval
Of the land banks appraiser and the
Federal Farm Bank. Each association
has a board of directors which has
the power to exclude or admit new
members by two-thirds vote. 1t is
through this local association that |
he farmer invests the money to be |
used for increasing the capital stock |
If the Federal Farm Bank, and this is |
how the farmer comes into possession
If his own banking system.
Farmers are permitted to borrow |
up to 80 per cent of the appraised |
value of their land and 20 per cent |
II the appraised value of the perma-
lent insured improvements thereon.
1t is not necessary for the borrow
II to be an actual land owner when !
lie joins, but the landless man must |
ssue the borrowed money to pur-
,hase land when he intends to i'm
nediately begin farming.