Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1920-03-05

poiat ON mortgage cert ,ntes bear
ing & per cent interest payable upon
any terms rcited. thereon and SEE
cured by "a deposit OF second mort
cages with a trustee equal In total
amount to the face value OF all GER
tlfcatcs outstanding.
when ready for business canvass
the city Tor unimproved lots whose
owners are willing TO sell ~ fair
price To the Home Builders Com
pany and accept therefor the COM
pany's . per cent mortgage certih-
Gates in full payment. Connect the
home builder with one or these lots.
sell IL TO him without profit to the
company, send him TO the local say
ngs and loan association for IA loan
Of all he can get upon a first mort
cage, which viii seldom exceed %
per cent OF the cOrnDined cost OF the
proposed new house and the lot. Re
quire the purchaser to deposit 10 per
cent OF the cost OF house and lot and
advance him the remainder, taking
a second mortgage with monthly
payments on the building and loan
Nmount advanced and the price of
the lot
How u Would Work.
In practice home owner, who
had looked over the company's list
of lots, and had purchased one for
$1,000 upon promise of being
'nanced for n new house to cost not
to exceed "a 500. would pay $500
down. He would appi, for loan
# $500 on n first NOR gage from
he Marshalltown Savings and Loan
ssoc.ation. He would submit his
aouse plans and contractors bids to
he directors of the Home Builders
rporation.
IF approved by them they would
agree to deed him the lot and loan
Elm 800. taking second mortgage
Tor $1,st0 subject to first mortgage
to the savings and loan assucia tion
for $4,000. The directors of the saw
mas and loan association, would then
pass on their loan When all were
agreed the home owner would have
q $4,000 house and lot decided to him.
uhject to two mortgages for
So. 100 at 8 per cent, but upon which
he must pay s27 per month on the
principal as we'll as the interest, and
in the ultimate his nome would DE
paid for in approximately eleven
gears at an average net interest cost
If 6 per cent, which is the experience
of the building and loan plan.
1T would cost him slightly more
Than this on about one third Of his
purchase because of the 8 per cent
which preferred stockholders must
earn. 1t would average s per cent on
the So per cent of the total purchase
which he borrowed from the savings
and loan association"
10 Workable and Sound.
Such a plan has been pronounced
as workable and sound financially.
The lot owner would receive for his
lot per cent certificate, secured
by a second mortgage on the house
and the lot. Back of him would be
the home owners payment of $500
and the company's advance Of 800.
or a net equity OF $1,000. which
would be margined down by monthly
payments on both mortgages.
The lot owner would be paid out
faster than the savings and loan as
ISOLATION, for the company would
come after him for its 500. In case
Of default. which seldom ever hap
pens with home owners. the Home
Builders Corporation would resell
the property and the home owner
would lost what he had paid in.
Trusteeine Stock Not Essential.
The trusteeing Of common stock
with tie Marshalltown Club is not
essential but there should be an in
yestment somewhere of boosters
money without profit so as to margip
the preferred stock and make it emf
nently safe and sound as an invest
ment solely upon an investment
basis. Some lawyers might prefer
trust deeds in place of second mort
sage security but these are details.
The fundamentals are a COM
munity merger Of the capital Of the
lot owner OF the savings and loan
association, and Of the lot owner on
a basis fair and safe to all assisted
and temporarily margined by the
capital Of the Home Builders Cor
poration until such time as the home
owner can increase his initial down
payment Of 10 per cent and establish
his equity sufficiently to carry his
loan.
An investment Of 100000 of boost
ers' money in the common stock OF
such corporation, plus $4,000 OF
investors money in the preferred
stock at per cent would finance
100 new homes in MarshalltoWn,