The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1924-02-16
BUILDING LOAN
Planned To
CLASS
G. Clinton James, Local At
torney, Talks on Home Buy
ing at Y. M. C. A.

Operation of building and loan
associations was explained to the
real estate class of the Y. M. c.. A,
by c. Clinton James, of the local
bar, second vice president of the
United States League of Local
Building and Loan Associations.
jam b said:
Membership in some form of
building and loan association, wher-
ever possible, is perhaps the most
satisfactory way in which to ar
range for financing a home. The
general plan is so sound, SO help.
1ul ana SO safe that building asso-
CATION movements are today serv-
ing over 1000 100000 members.
The total assets Of all associations
are now approximately three and
one-half billion. Their main object
IS 10 receive money from members
ana TO loan it to those who want
10 Duild or buy homes-to do this
on 1alr terms and under a particu-
larly convenient repayment pro-
gram.
The returns from the loans are
returned to the members after a
modest operation expense has been
cared Tor and after setting aside
a reserve to act as a safeguard
for loss.
mo other form of financial insti.
tuition is paying such high earn
lngS TO those investing. No other
agency offers such helpful and
convenient service to people seek.
ing home ownership.
STARTING MEMBERSHIP.
ITO become an investing member
OF a building and loan association
you can start an account in the
association operating on the per-
manent plan, which means an asso.
citation that declares dividend
each year, by depositing 81 up and
such other sums as one may be
able to spare from his income. In
the serial associations, in which a
new series Is started every six
months. a person may become a
member by paying back the months
that have elapsed since the series
started and SO get the full benefit
OF the series,' If he stays until the
series closes.
These accounts can be opened at
any time. in either class of associa.
tons. The advantages Of member.
ship are: 5000 dividend is exempt
from Federal income tax; all divi.
bends are exempt from intangible
tax except special deposits. The
association, however, pays per
cent on its gross earnings as in.
tangible taxes.
A person desiring to borrow must
first make application, his property
Is then appraised by the association
appraisers at an average cost of
about 81. If the .loan is approved,
the only expenses he bears are for
examination of title, drawing the
necessary papers, recording, revenue
stamps, fire insurance, notary fee
and tax certificate. The borrower
is required to pay back monthly
on his loan 81 for each 500 he Dor
rows. Half of this amount is
credited to interest and half
to principal, the interest being
at the rate of per cent.
IF he had had a straight mort.
gage loan on his property for
twelve years and eleven months, he
would have paid $775.OO interest.
II the loan could have been renew.
ed every three years for l yer cent
commission, there would have been
four renewals amounting to $4,000,
which would make his interest and
commission $S15.00 and he would
still owe $1,000. the principal sum
Under the serial plan Of loanine
IL he borrows $1,000 and pays $40
per month. this loan would be paid
Of in ISL months. He would have
paid $755 on stock and $755 in.
terest. The stock payments would
be worth $1,000, or SPAS in divi.
dends. He has paid $755 in in.
terest and is credited $245 as
dividends on his stock payments,