The Sauk Centre herald. (Sauk Centre, Stearns County, Minn.) 1886-current, 1926-12-02

Minnesota farms, amounting to S4l,-
$4,000, which were outstanding No
vember /, 1926, has been $3,467,"
amounting to S5,235, 900, have been
placed by the rural credit depart
ment since the new management
took charge on July l, 1925, accord
ing to Ole o. Sageng, chairman of
the department. At the start of the
1925-26 fiscal year, the states rural
credit loans numbered 1882, aggre-
eating $36,642,000, he reports.
There figures show that the av-
erage amount of loans, during the 16
months from July 1, 1925, to No
vember 1, 1926, has b cen S3,467,"
Mr. Sageng said. 'This represents
decrease of more than $1,000
from the average of the first two
years operation of the system. We
are making our loans on more con-
sentative basis than was the case at
first. Another important factor is
that we are placing larger per-
centage of our mortgages in southern
Minnesota, where the land values are
somewhat more stable and the risk of
loss is somewhat less, judged from a
district wide viewpoint, than in the
northern part of the state. For the
past year or so loans in the two sec
lions have been about equal in num-
ber."
The decrease in average size of
rural 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 val
ue of buildings. In it's effort to place
the credit bureau operations on a
more conservative basis, the legisla
ture reduced the maximum of loans
to so per cent on land and 80 on
buildings.
"Of the S,762 farms on which our
department has taken mortgages, we
have 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
mortgages has expired in SO cases.
Many of the remaining 129 are sure
to be redeemed before the time limit
is up.
"In my belief, this percentage of
foreclosures, representing possible
losses on the funds advanced, is not
in any sense high, in comparison
with figures reported by other agen-
cies negaged in the farm mortgage
business. We have sold 10 of the
SO farms to which the bureau was
forced to acquire title and have not
had to stand 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 foreclose."
The operations of the rural credit
department have been so successful
as to permit of a cash surplus of
1898, 900, as of November l. available
for use in meeting losses on loans or
ether contingencies, Mr.. Sageng said
the department loans rural credit
funds to farmers, living on or operat-
ing their own farms, at the rate of
5H per cent, to which is added l per
cent to be set aside as a fund for
amortization of the loan.
The funds lent to farmers are OBJ
tanned by sale of state rural credit
bonds, of which a total of $4,000
900 was authorized in 1928 and an
other S20,000,000 was added in 1925,
making an authorized total of $780,
100000 for mortgage loans on Mime
sofa farms.