Rensselaer Republican, Volume 16, Number 34, Rensselaer, Jasper County, 1 May 1884 — A Building, Loan Fund, and Savings Association. [ARTICLE]

A Building, Loan Fund, and Savings Association.

Editor Republican:—As there is strong talk among the citizens of Rensselaer, of the formation of a Building, Loan Fund, and Savings Association, it might not be amiss to give your readers a brief synopsis of the aim, mode of formation, and woikings of such an organization. The object of the association may be said to be, “to provide its members a safe and profitable investment of small weekly installments, • and to loan them money on easy terms, to enable them to purchase a home, or make other investments.” The mode of formation, and workings of such, an organization is regulated by law, (see Acts 1881, section 3407), and is briefly as follows: The organization must have a capital stock, . say of $50,000, divided into shares of, say SSO each, and each person can subscribe for not to exceed a certain number, say ten shares, and lie pays into the treasury a Certain installment per week on each share of stock held by him, usually 25 cents per week on each share. In addition to this there is usually a system of fines and penalties attached for certain delinquencies, for instance a a fine of 5 cents per week per share, upon failure ’to pay- a weekly installment, and a small tine for failure to pay interest on loans when due &c. These, together of course with accumulated interest, are the source of income to the association. When a certain amount, say .#2OO is accumulated in the treasury it is loaned to stockholders only, at the rate of six per cent per annum, and is secured by first mortgage, or other substantial security, the money being auctioned off, and the member who pays the highest premium per share, secures tne preference, the premium being so much per share per week, during the coni innance cf the loan. Any- stock-holder who wishes at any time to withdraw from the association will have the amount paid in by him returned, with six per cent interest thereon. When the total amount of installments paid in, together with the accumulations amount to a sum sufficient to make out standing shares equal their face valiie or in this case SSO each, the shares shall be cancelled, and each owner Of a share shall receive its face valaei Tn money. .

Thgt these organizations are beneficial to a town no one doubts, and no more forcible illustration of this fact can be given than that there has been a statue in the State reghlating them for years. An association of this kind is a stepping stone for the poor man, and a good investment for the rich man, and. is benelicial to all parties. It is a savings bank on an extended, scale in which all are stock-holders, and share in the profits, and is entirely safe. In conclusion allow me to quote from a letter recently received from the secretary of an association where the capital is •’*•300,000. ‘‘Next to schools and churches a well conductedJouilding and loan associaftjon wilL rin. more I’m-..a cammunli^, than anything else."

WILLIAM B. AUSTIN.