Gunnison news-champion., 1922-05-26
FEDERAL LAND
BANK BRANCH
IS FORMED

Thirty-one prominent ranchmen and
ranchwomen of the county put In an
earnest days work Tuesday organiz-
ing a branch Of the Federal Lana Bank
in the nature of Farm Loan Associ-
alton, to secure funds from this bank
at Wichita on the amortization plan.
The organization has been perfect
ed with the following directors: J. b.
Outcalt, Gunnison; I. L. Crews, Sapi-
nero; j. A. Blair, Lake Fork; Pat
O'Fallon, Gunnison, A. NJ. Il. Crooks,
Gunnison. Mr.. O'Fallon was elected
president, A. NJ. r. Crooks, vice-pres-
ident and Mrs. +. Johnston Outcalt,
secretary-treasurer
They were 81 applications for loans
on the day of organization, and many
others are expected in the near fu-
ture. Mrs. Outcalt has been especial
ly active in furthering the plans on
the Farm Loan Association, and
has visited all parts of the county
during recent weeks, looking over the
situation. IL plans go thru as expect
ed, there will be in the neighborhood
of quarter of million outside cap
ital brought into Gunnison county at
once to assist in financing the local
ranches, for improvement and work
ing capital.
The nature of the Federal Land bank
of Wichita is not generally known,
but it differs materially from the
War Finance Corporation, which
has been loaning much money to the
stockmen on their cattle. This last is
government money, loaned on basis
Of 71s per cent. The Federal Land
Bank does not use government money,
altho it is under government supervi-
sion. The bank of Wichita which Is
the center Of District No; 9, including
the states Of Oklahoma, Kansas, New
Mexico and Colorado, sells its mort
cages on its own resources to raise
money for the loans. The mortgages
are sold on basis Of four to fiye
per cent interest, but the borrower
pays seven per cent. Six per
cent Of this is interest, the remaining
one per cent being applied to reduce
Tie amount Of the original loan, which
Is entirely paid of in S3 years, and
thus never comes due, unless by de-
fault. The Bank Of Wichita has loan
ed some 100000 in these four
states, most Of It within the last two
years. The basis Of the loan is on
not more than so per cent Of the ap-
praised value Of the ranches, and not
more than 20 per cent Of improvements
thereon. A local committee will b
appointed to make the appraisement,
these figures to be checked by the
bank appraiser.
These loans have many valuable
features outside Of the low rate Of in
terast. To illustrate just how It
works, take . loan Of $1,000 on the
seven per cent basis. Payments will
be $40 a year, or $35 every 6 months.
OF the first $35 only $50 Il applied on
interest, IS going toward repaying
the loan, 20 that at the end Of eix
months you only owe 1896. At the
end Of five years or ten payments, .
$35 payment il applied, $28AS on IN
terest and $6.52 ON the principal, and
you owe the bank not 81 900 but only
$942.69. On the twentieth payment,
at the end Of ten years, $26.23 goes
for interest and $8.77 on the princi-
pal, and you can cancel your debt by
paying the bank $865.67 instead d
$1,000. At the end Of the 66th pay
naent, you owe nothing instead Of
$1,000. The farmer can also cancel
the entire loan ut any payment peri-
cd, by paying the balance due.
inert arc no umit8O0ub n 70 bcAt-
ing the property, in fact, it becomes
the prospective purchaser assume1
that It is good property, or the gov
eminent would not loan money on t.
and further. by taking over the habil.
ity, he already has the purchase part
y financed No person can borrow
less than 500 or more than $4,000
nnder the plan. e
Nearly IN the ranchmen Of III
,pgihcipal eounties of Colorado have
now formed associations similar tf
fds, to seeaEe Sthsfr pruport3onatl
6hare Of the funds avai1abl6-
CsmR.ete infs.natiea e H. -
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