Loan repayment

“ A loan is—an issue of government bills of exchange containing a percentage obligation commensurate to the sum of the loan capital. If the loan bears a charge of 5 per cent, then in twenty years the State vainly pays away in interest a sum equal to the loan borrowed, in forty years it is paying a double sum, in sixty—treble, and all the while the debt remains an unpaid debt. ”

“ The redemption shall be effected by purchase at the market price. If the market price be above par, it shall be effected by drawings at par.
Art. VI. The service of the Guaranteed Loan shall be conducted by the Treasury of the Public Debt, under the same conditions as the Preference and Unified Debts.
Art. VII. The Commissioners of the Treasury of the Debt shall, fifteen days previous to each payment falling due, furnish us with an account, in a special Report to be published in the 'Journal Officiel,' of the state of the funds assigned to the service of the loan. ”

“ In making loans it should be recognized that character and industry are the basis of credit, and a loan may be made to a member who has not adequate security to pledge for it, provided he can obtain the guaranty of one or more other members, but no member is obliged to guarantee the loan of another member unless he desires to do so. ”

“ While the special time for contracting loans is a month after the harvest, borrowing goes on all the year round. If the debtor can not pay at the maturity of his loan, the creditor acquires the right of making himself at home in his house, and demanding and receiving the best until he is paid. ”

“ Loans are made on written applications which are required to designate the purpose for which the loan is to be used, and the borrower is required to agree that the loan shall be used for those purposes. ”

“ Loans shall be made only for the purposes which promise to result in a saving or a profit to the borrower. Each applicant for a loan must state the object for which he desires to borrow, in order that the credit committee, which passes on all loans, may rigidly exclude thriftless and improvident borrowing. ”

“ All remittances for advance, instalments, premiums, monthly instalments, fines and penalties, interest and premiums, and all other payments shall be made to the secretary of the association at the home office, and in registered letter, express or money order, or drafts. Individual checks shall not be received.
The other sections of the article provide for the manner in which the loan shall be made, upon what security, interest and premium, and covenants, the manner of payment and prepayment, and the enforcement of payment, and when shares may be canceled and forfeited. ”

“ The workman and his two sureties who do not return the sum borrowed must never again have another loan, having forfeited his sacred engagement, and, especially, having deprived so many of his brethren of the advantage he has enjoyed, as the sum he has not repaid is for ever lost to the Bank for the Poor. The sums lent being, on the contrary, scrupulously repaid, the loans will augment from year to year. ”

“ And the advance, therefore, upon every note discounted, without reference to its character as business or accommodation paper, is properly denominated a loan, for interest is predicable only of loans, being the price paid for the use of money. ”

“ The fact that the debt is growing less, and, as well, the incentive to avoid small fines in case of failure to make payment, contribute to the value of the security. A loan on an ordinary basis, secured from a savings bank, insurance or trust company for a long period, is not thought of in this way. ”

“ But on the other hand, if 4 per cent, bonds are selling at par and he chooses a 4 per cent, loan, he gets his $1,000 in cash for his Pfandbrief and pays $40 per year interest and gives his mortgage and note for $1,000. It is always regarded as the best policy for the borrower to choose the class of bonds selling nearest par, unless they are selling above par, in which case the farmer securing the loan gets a premium over and above the amount of his liability and it is to his advantage to take such loans. ”

“ Rather than stop payment, he will, of course, make temporary sacrifices—will give high terms to whoever will furnish him with the desired means. If, by depositing securities with his banker, he can get a loan at an advanced rate of interest, well. If not, by offering an adequate temptation, he may mortgage his property to some one having good credit; who either gives bills, or draws on his banker for the sum agreed to. In either case, extra promises to pay are issued; or, if the difficulty is met by accommodation-bills, the same result follows. ”

“ No person, firm, or corporation, or any agent thereof, other than a national bank or a bank or trust company duly incorporated under the laws of this state, or a pawnbroker, as provided in chapter 235 of the Public Acts of 1905, shall, directly or indirectly, loan money to any person, and directly or indirectly charge, demand, accept, or make an agreement to receive therefor interest at a greater rate than 15 per centum per annum. ”

“ The time and manner of repaying, unless the loan be placed on an irredeemable fund. This enumeration is liable to a variety of objections. It omits, in the first place, the pledging or mortgaging, of a fund for the security of the money lent; an usual, and in most cases, an essential ingredient.
The idea of a stipulation of an interest or no interest, is too confined. It should rather have been said, to stipulate the consideration of the loan. Individuals often borrow upon considerations other than the payment of interest. So may government; and so they often find it necessary to do. ”

“ A law authorizing the government to guarantee a certain percentage of any loss which may be suffered by any private bank, insurance company or any other credit institution, on account of loans it may grant to private individuals for home construction, the amount of each loan not to exceed P10,000 for each individual borrower, and fixing the aggregate amount of the loans for which such guarantee may be given. ”

“ The admirable process of small monthly payments not only educates the borrowers into habits of saving, but in a few years reduces the loan, so that the old-fashioned savings banks with their immense capital can take 125up at lower rates these loans, when they are reduced to the statute limit of 60 per cent of the value of the estate. ”

“ Thus the law forbade a rate of interest higher than twelve and one-half per cent in sixty days, or seventy-five per cent in a year, and also provided that under no circumstances should the total payment on account of interest exceed the principal. The result of the latter veto was that debts remaining unpaid after four hundred and eighty days ceased thenceforth to carry interest. If a debtor failed to repay a loan, he had to become the servant of the creditor, and probably for that reason officials and nuns were not allowed to borrow under any circumstances. ”

“ A borrower desiring to obtain an insured loan applies directly to the private lender, which has final authority to decide whether the loan should be made. If a loan is granted, the lender reports the details to the FHA which automatically insures the loan as soon as the required premium is paid. ”

“ And the same must be said of the value at which they have reckoned the short annuity of a half per cent. for ten years annexed to the new 4 per cents. In forming the scheme for the last loan this annuity was, I have said, estimated at 81⁄10 years purchase, agreeably to its real value, supposing the payments yearly, the first payment to be made at the distance of a year, and money improved at 4 per cent. compound interest. But it has in general been sold at about 71⁄2 years purchase; which is less than its value, supposing money improved at 51⁄2 per cent. compound interest. ”

“ Many of these assertions the needy borrower will find abundant reason to doubt before the loan is completed. On application she will be puzzled to reconcile the terms named to her with those in the alluring advertisement, and will find the rate of interest to be truly “five per cent. and upwards,” fifty per cent. being no uncommon demand, in addition to expenses connected with and deducted from the loan. Should she complain about the expenses, she is usually told that they are rendered necessary by the existence of some special risk in her particular case. ”

“ When a loan is made, the attention of the borrower is seldom called to the rapidity of increase and the dangers of accumulation. If this were done, and a prompt return of both principal and interest required, at the end of the term the borrower would soon be alarmed at the hopelessness of permanent gain through debt. ”

“ A loan for consumption to be returned in kind contemplates a restoration not of the identical thing loaned, but of a similar article equal in quantity, and if no return be made, all that the lender can require is the value of the thing which should have been returned at the time when the contract was broken. ”

“ Provided, That there are appropriated for the cost of the guaranteed loans such sums as are hereafter derived from amounts received from borrowers pursuant to section 1702 (b) (2) of that Act, to remain available until expended: Provided further, That the source of payments received from borrowers for the subsidy cost shall not be a loan or other debt obligation that is made or guaranteed by the Federal government. ”

“ Current economic uncertainty makes the loan necessary to support your ongoing operations. The funds will be used to retain workers and maintain payroll or to make mortgage, lease, and utility payments. You have not and will not receive another loan under this program. You will provide to the lender documentation that verifies the number of full-time equivalent employees on payroll and the dollar amounts of payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities for the eight weeks after getting this loan. ”

“ For the purpose of discharging said indebtedness, he asked authority to make an additional loan in gold of a sum not exceeding $95,000, or its equivalent in paper currency of the United States, paying interest thereon at the rate of 9 per cent. per annum in gold. ”

“ In the borrowing of the money that may be needed in developing said enterprise, he is to use his credit by joining the other parties to this contract in the making or indorsing of any notes that may be required in negotiating the necessary loans for the making of said improvements and in paying off the loan of $32,000 now due on said property. ”

“ The lenders receive a certificate of indebtedness, and have the right to buy each year a quantity of my books at half the retail price. Thus, if you lend ten dollars, you can get $5 worth of books for $2.50. These books must be ordered in one shipment, so as to save handling costs; under the Loan Plan you may place one such half-price order every year. The saving takes the place of interest on your money; it amounts to 25% interest—a pretty good rate, but not so high as millions of poor farmers are having to pay to national banks all over the country—see my “Letters to Judd”! ”

“ The outlays resulting from new budget authority for the cost of direct loans or loan guarantees described in paragraph (1) shall be paid from the credit program account into the financing account and recorded in the fiscal year in which the direct loan or the guaranteed loan is disbursed or its costs altered. `` (3) All collections and payments of the financing accounts shall be a means of financing. ”

“ Congress, in substantial conformity with the recommendations of Secretary Chase, passed the act to authorize a loan which was approved July 17, 1861, providing for the issue of $250,000,000 of bonds running twenty years, bearing not exceeding seven per cent. interest, or treasury notes for not less than fifty dollars each, bearing interest at not less than seven and three-tenths per cent. annually, and payable in three years, and treasury notes of less denomination than fifty dollars, not bearing interest and not exceeding $50,000,000, payable on demand, and commonly known as demand notes. ”

“ This was adjusted by a prolongation of the period of reimbursement in nature of a new loan at an interest of 5% for the term of ten years, and the expenses of this operation were a commission of 3%.
The first installment of the loan of $2,000,000 from the Bank of the United States has been paid, as was directed by law. For the second it is necessary that provision be made.
No pecuniary consideration is more urgent than the regular redemption and discharge of the public debt. On none can delay be more injurious or an economy of time more valuable. ”

“ A loan is a temporary gift, and the nature of the transaction remains the same whether the man to whom the loan is made does, or does not, come under the obligation of paying rent or performing services. ”

“ The period of twenty years, as that for which the proposed loan may be contracted, in preference to a shorter period, is suggested, because all experience, both at home and abroad, has shown that loans are effected upon much better terms upon long time than when they are reimbursable at short dates. ”

“ The security taken is on freehold, or leasehold, interest clear of incumbrances and free of any breach of conditions. The loans are on first mortgage of land and improvements. No loan is to be less than $125, or more than $15,000, and the sum of the advances to any one person must not exceed $15,000. ”

“ If the transaction were unaffected by the provisions of the Farm Loan Act, it would require no argument or citation of authority to support the conclusion that the delivery of the note and mortgage to the lender, and the receipt of the check from the lender, payable to the obligors upon the mortgage indebtedness, and their indorsement and the collection of it, would establish their liability for the payment of the loan, regardless of what might become of the proceeds. ”