The midland journal., 1917-07-06
Axe MAKING Use
OF LAND BANK
MARYLAND Farmers Organizing
Loan Associations.
STEPS TO TAKE
STEPS TO
Aid Of County Demonstration Agents
Can Be Secured In Organization.

College Park, July 5.-In co-opera-
ton with the Federal Land Bank OF
Baltimore, the Extension Service OF
the Maryland State College of Agri-
culture, through its county demonstra-
ton agents, has begun campaign OF
education, with view of making the
farmers of Maryland better acquainted
with the Federal Farm Loan Act and
it's uses.
1t has been recognized from the be-
ginning that the farmer would be slow
to take hold of the idea Of new klno
of banking institution; and that es-
pecial efforts would have to be made
to arouse popular interest in the Or
ganization Of the Farm Loan Assoc1a-
tions in the various counties. In Or
der to accomplish these ends, the Ex-
tension Service has just published
Bulletin No. 4, entitled, "The Federal
Farm Loan Act and The Farmer" by
F. B. Bomberger, Assistant Director.
This bulletin is designed to present
in simple language such directions and
explanations as will enable any group
of farmers, who desire to borrow
money upon the security Of their farm
lands, to proceed step by step in the
organization of National Farm Loan
Association, and actually to do the
things necessary to be done in order to
receive from the Federal Land Bank
of Baltimore, the loans which they
may desire in order to finance their
farming operations.
The bulletin explains the purposes
of the law and furnishes the general
outlines of the Farm Loan System.
Then follow the successive steps nee
essary to be followed in the formation
of the organization. Blank forms OF
organization, provided by the Federal
Land Bank of Baltimore, are printed
in the bulletin in order to make very
explicit exactly how the association is
TO be formed and how it is to proceed
after it has been organized.
In discussing the scope Of territory
to be included in any one associa-
ton, it is pointed out that the Federal
Land Bank of Baltimore, recommends
that the county be made the unit OF
organization, and that the Secretary
Treasurer be located at the countyseat
where the records of the county will
be readily available.
Any ten farmers who desire to bor-
row an aggregate amount of $4,000
may form an association, although 1t
IS desirable to have more than ten in
the initial organization. A farm may
borrow any sum from $100 to 10000.
After charter has been granted to
the original association, any farmer
of the county must borrow through
the county association,
An interesting feature of the System
is that each borrower must become
member of the County Association
by investing five per cent. Of the pro-
ceeds of his loan in the stock of the
Association. This stock will partici-
pate in the earnings of the Association
and the amount invested in the stock
will be returned to the borrower when
his loan is paid off.
All loans run for the period of thirty
SlA years, UUL LAC UOIlOWC CI may Poy
off the loan at any time after five
years. An interesting feature of the
system is the fact that the borrower
is required to pay an annual Install
ment of one per cent. on the principal
in addition to the interest. Thus, at
present the loans bear interest at nve
per cent. and by adding one per cent,
making a total of six per cent. per
year, the loan is fully paid off in
thirty-six years.
The advantages inherent in this sys-
tenn of long term loans, with low rate
Of interest and the privilege Of pay
ing of the principal of the loan in
annual installments of only one per
cent, should make it very attractive
to farmers who want to borrow
money upon their farm land. These
features remove the dangers that
have heretofore attended the borrow
ing of money upon short term mort
cages and do away with the expense
of making new mortgages and secur
ing new loans.