The Redwood gazette. [volume] (Redwood Falls, Minn.) 1873-1940, 1926-12-01
GOVERNOR SEEKS
NO CHANGE IN
CREDITS ACT
OLE SAGENG, CHAIRMAN, MAKES
REPORT OF RESULTS OF LOAN
SCHEME FOR LAST YEAR:
BOON TO FARMERS.

SOAEM n TOR LAS1 GAns
BOON TO FARMERS.
With total of Sal, 900 advanc-
ed to 8,762 Minnesota farmers in first
mortgage loans, the work of the Min
nesota rural credit department is pro-
crossing so satisfactorily that no
changes in the rural credits act are
needed, in the opinion of Governor
Theodore Christensen.
No recommendation for new legisla-
ton to strengthen or otherwise revise
the state system of extending credit to
farmers will be included in the execu-
tive message to the 1927 legislature,
Governor Christensen says.
I 81 have every confidence that, un-
der the present structure of the rural
credit act and under the plans now
being followed, the states work of
extending credit to our farm owners
will be carried on very successfully
and that there will be ample funds
to care for any probable losses" the
governor said. "My message to the
next legislature will not recommend
any changes in the present law.
"The last legislature did good
piece Of work, in its revision of the
original credit act. 1t outlined bust
ness-like, practical program, calculat-
ed to make real contribution to the
welfare of Minnesota agriculture,
while not jeopardizing the public
funds. No more legislation is needed,
in my judgment. The task now is one
of organization and administration
and both have been carried on eff
fectively by the executives who as
stunned charge of the department in
1926"
Of the 8,762 mortage loans on Min
nesota farms, amounting to $41,877,-
900, which were outstanding Novem-
Der 1, total of 1910 loans, amount
ing to $5,235, 900, have been placed by
the rural credit department since the
new management took charge on July
1, 1925, according to Ole o. Sageng,
chairman of the department. At the
start of the 1925-26 fiscal year, the
states rural credit loans numbered
1882, aggrgating $36,642, 900, he re-
ports.
"There figures show that the aver
age amount Of loans, during the 16
months from July 1, 1925, to Novem-
Der 1, 1926, has been $3,467," Mr..
Sageng said. "This represents a de-
crease of more than $1,000 from the
average of the first two years opera
ton of the system. We are making
our loans on more conservative bas-
is than was the case at first. Anoth-
er important factor is that We are
placing a larger percentage of our
in southern Minnesota,
where the land values are somewhat
more stable and the risk Of loss is
somewhat less, judged from district
wide viewpoint, than IN the northern
part of the state. For the past year
or so loans in the two sections have
been about equal in number"
The decrease in average size of rur-
al credit loans, however, is due in
part to the more rigid, limitation
which the 1925 legislature placed on
the sums to be lent to farmers on
their properties, Mr.. Sageng explain
ed During the first two years, the
limit was 60 per cent of the value Of
land and 33 1-3 per cent of the value
of buildings. In it's effort to place
the credit bureaus operations on a
more conservative basis, the legis-
lature reduced the maximum of loans
to SO per cent on land and 80 on build
ings.
"Of the 8,762 farms on which our
department has taken mortgages, we
hove had to foreclose on only 225,"
Mr.. Sageng said. "Of this number,
we actually have acquired title to
only 90, which means that the one
year period for redemption by the
has expired in 90 cases.
Many of the remaining 129 are sure
to be redeemed before the time limit
is up.
"In my belief, this percentage of
representing possible
losses on the funds advanced, is not
in any sense high, in comparison with
figures reported by other agencies en-
gagged in the farm mortgage business.
We have sold 10 of the 96 farms to
which the bureau was forced to ac-
4uire title and have not had to stand
q loss on any of them. A few of the
farms even made a small profit for
The department. Of course, we do
not imagine that there will be no loss
on any farm on which we have to
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