New Mexico state record. (Santa Fe, N.M.) 1914-19??, 1917-03-30
DETAILS OF THE
FARM LOAN BANK
SYSTEM EXPLAINED
THE WICHITA BANK Is THE
FIRST ONE READY FOR
BUSINESS. THE LOCAL AS.
S0CIATI0NS ARE ALSO
FORMED AND READY

Callahan, president of the Wichita
Federal Land Bank, has returned
from Washington, where he attend
ed conference of the presidents of
the twelve federal land banks, with
Secretary of the Treasury McAdoo
and the members of the Federal
Farm Loan Board. He expressed gra-
tification over the fact that this con-
ference had fixed flat interest rate
of S per cent, applying to all parts
of the United States. He declared
that this interest rate would prove
great boon to the farmers of the
Middle West and predicted that with
in a year the Wichita Federal Land
bank will have made loans aggregat-
ing 100000 to $l0,0O0,000.
Mr.. Callahan also announced that
the conference of bank presidents
passed resolution requesting con-
gress to increase the limit of the
loans permitted to an individual bor-
rover from $4,000 to $4,000. He
expressed the hope that the special
session of congress, soon to convene,
would make this change for the
special benefit Of the Wichita bank
district, where the average size of
farm loans is larger than in any
other section of the United States.
In order that more funds may be
available for investment in farm loan
bonds, and in turn made available
to lend to farmers OF this district,
Mr., Callahan urged that the legisla-
tures of Kansas, Colorado, Oklahoma
and New Mexico Immediately pass
laws making farm loan bonds ap-
proved investments for trust funds,
insurance companies and savings
banks.
Mr.. Callahan announced that the
bonds issued by the twelve federal
land banks would be placed on the
market at II per cent, but would
probably be sold at premium. He
qualification over the fact
that the Federal Farm Loan Board
has anticipated that at least $780,
000000 Of these bonds will be issued
during the coming year and is max
ing arrangements which will assure
a ready market for them, All of
this money win be made available
to the farmers of the United States
at per cent.
To borrow from these federal land
banks, farmers are required to Or
ganize themselves into groups con-
tanning at least ten farmerborrow-
ers and each group asking for at
least $4,000 of loans. The Wichita
Federal Land bank is now prepared
to furnish a blank form of articles of
association to make the organization
of these groups simple and easy.
Other necessary blanks will also be
furnished on application.
Farmers are permitted to borrow
up to SO per cent of the appraised
value of the land. plus 20 per cent
of the value of the permanent insur-
ed improvements. Loans are to be
made at S per cent and must be
retired on the amortization plan,
which means repayment by fixed an.
nual payments thruout the period OF
the loan. The loans may run from
) to 40 years at the option OF the
borrower. The object of these long
time loans is to enable the farmer
20 meet these small annual payments
out of the increased earnings OF the
and, made possible by the invest
ment of the borrowed money.
This new banking system is purely
1t is for the sole use
IF farmers and prospective farmers.
Farmers will eventually own all of
The stock of the federal land banks
md they will elect the officers of
hese banks. There is no opportu-
,ity for individual profit in the
,ntire system.
The preliminary organization OF ma
onal farm loan associations has prog !
essed to a degree far beyond the
of the Federal Farm
-oan Board at Washington and
points to the unqualified
uccess of this.ne enterprise.
The Wichita bank was the first
'ank organized under the new sys-
EN- and is making fine progress.
he first applications are in, and
bstracts are being examined, and in
few days actual loans will be made.
dr. Callahan states the appraisals
o far made have been in the best
ections and are strictly first class.
lis examiners find the people much
1terested in the work of the new
ank and are delighted to konw
hat literature being circulated by
,an companies is composed mostly
{ Misrepresentation. Information
nd circulars as to the operation of
he farm loan act may be obtained
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