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of each bi-weekly payment, $2.50. Of this amount $1.50 paid on account of dues and premium is credited to the borrower, only the interest going to the association. If the borrower bids a premium of more than $1, the excess goes to the general fund of the association and not to the individual credit of the borrower. The payments continue until the dues, together with the premium and dividends, equal the amount of the loan.

The number of associations operating under this plan is as follows:

LOCAL.-District of Columbia, 16; Florida, 1; Georgia, 6; Pennsylvania, 21; Virginia, 12; total local associations, 59.

PLAN 62.

Under this plan the premium is _oither a fixed rate or determined by bid. The borrower receives the full amount of the loan, but gives security covering both the loan and the premium, and pays interest on the amount actually received by him until the shares reach the value of the face of the mortgage.

Illustration: A member borrows on one share $100, at a premium of 10 per cent. He gives security for both the loan and premium, $110, but he pays interest only on $100, the amount received. His weekly payments are as follows: Dues, 25 cents; interest on $100 at 6.24 per cent per annum, 12 cents; total payments each week, 37 cents. These payments continue until the share has reached the value of $110, unless the loan has been previously repaid.

The number of associations operating under this plan is as follows:

LOCAL.- Nevada 1; New Jersey, 1; New York, 24; total local asso. ciations, 26.

PLAN 63.

Under this plan the premium is either a fixed rate or determined by bid. The borrower receives the full amount of the loan, but gives seenrity covering both the loan and the premium, and pays interest on both until the shares reach the value of the face of the mortgage.

Illustration: A member secures a loan of $200 on one share, at a premium of 20 per cent. He receives the full amount of $200, and gives security for $240, on which he pays interest. His monthly payments are as follows: Dues, $1; interest on $240 at 6 per cent per annum, 81.20; total payments each month, $2.20. These payments continue until the share has reached the value of $240, unless the loan has been previously repaid.

The number of associations operating under this plan is as follows:

LOCAL.-Georgia, 1; Illinois, 1; New York, 2; Pennsylvania, 2; total local associations, 6.

PLAN 64.

Under this plan the premium is either a fixed rate or determined by bid. The borrower receives the full amount, but gives security cover

ing both the loan and the premium, and pays interest on both. The premium is paid in instalments, usually at the same time with dues and interest. Payments of dues, premiums, and interest continue until the shares reach maturing value.

Illustration: A member borrows $1,000 on ten shares of a matering value of $100 each, at a premium of 25 per cent. He receives $1,000, but gives security for $1,250, the amount of his loan and premium. He pays the premium in monthly instalments by taking three additional shares and paying dues thereon. His monthly payments are as follows: Dues on ten shares at 50 cents a share, $5; dues on three additional shares in payment of premium, $1.50; interest on $1,250 at 7 per cent per annum, $ 7.29; total payments each month, $13.794. These pay. ments continue until his shares have reached maturity, when he receives $50, the difference between the debt and the maturity value of thirteen shares.

The number of associations operating under this plan is as follows: LOCAL.-Illinois, 1; total local associations, 1.

PLAN 65.

In this case the borrower receives the full amount of the loan, but gives security covering both the loan and the premium, and pays interest on both until the shares pledged for the loan reach maturing value.

Illustration: A member borrows $150 on one share, at a premium of 10 per cent. He receives the full amount of $150 and gives security for $165, on which he pays interest at the rate of 6 per cent per annum. Payınents are bi-weekly and are as follows: Dues, 50 cents; interest on $165 at 6 per cent, 38, cents. These payments continue until the share has reached the value of $150, being the maturing value of shares, unless the loan is previously repaid. Although the premium is included in his mortgage, the borrower does not really pay it; in faet, the only premium he pays is the interest on the difference between $165 and $150, the amount actually received.

The number of associations operating under this plan is as follows: LOCAL.--Pennsylvania, 9; total local associations, 9.

PLAN 66.

Loans are awarded to shareholders bidding the highest premium. The borrower gives security for the loan, the premium, in whole or in part, and the total dues for a definite period. This he pays off in equal instalments extending over a definite period, at the expiration of which the loan is cancelled. A rebate is allowed if the loan is repaid before the end of the period.

Illustration: A loan of $500 is made at a premium of $100; these two amounts are added to the dues on one share of stock for ten years,

$500, but gives security for $730, the total sum of the loan, dues, and premium. The total amount of his mortgage is paid in ten years in monthly instalments of $6.08f each. If more than $100 premium is bid, the excess is deducted from the $500, the borrower receiving the remainder, but giving security for the full amount, and discharging his debt by monthly payments as illustrated above.

If a loan is repaid before maturity, rebates are allowed as follows: If repaid at any time prior to the expiration of five years, the borrower is allowed a rebate of one-half of the premium instalments for five years, and all the dues for five years. For example: At the end of the year he has paid $73 on his mortgage, of which $50 is return of loan, $10 is premium, and $13 is dues. He now desires to pay off his entire indebtedness, and the cash required of him for this purpose is $567, stated as follows: Original amount of mortgage

$730.00 Dednet amont prict during one year.

73.00 Balance due ...

657.00 From this balance deduct 50 per cent of five years' premium instalments (50 per cent of $50)..

$25.00 Also deduet all of five years' dues ($13X5)

65.00

90.00 Amonnt required to pay ott indebtedness....

567.00 If the debt is paid at any time after the expiration of five years, the borrower is allowed a rebate of 50 per cent of the premium instalments, and all of the dues unpaid.

Members who borrow after having paid dues prior to borrowing are given credit for the withdrawal value of their stoek at the time the loans are made, but such credit is not given until the expiration of one year from date of loan. Thus, suppose in the case of the borrower above cited, his share at the time he secured his loan had a withdrawal value of $25. During the first year of the loan he is required to pay the full amount of instalments, $73. At the end of the year he is credited with the withdrawal value of his share, $25, and during the second year of his loan he is required to pay only $18. After the second year until the loan is paid off, he pays the full amount, $73,each year.

The number of associations operating under this plan is as follows: LOCAL.-New Jersey, 3; total local associations, 3.

PLAN 67.

Loaus are awarded to shareholders bidding the highest premium. The premium is either deducted from the loan in advance or the bor rower receives the full amount as may be agreed upon. If the premium is deducted, the borrower receives the balance, but gives security for the full amount and pays interest thereon. If the borrower receives the full amount of the loan, he gives security for both loan and premium, and pays interest on the same. Payments of clues and interest continue

until the shares reach a value equal to the amount of the security given by the borrower. No part of the premium paid in advance is returned to the borrower in case of the repayment of the loan before the maturity of the shares.

Illustration 1: ad member secures a loan on five shares of a maturing value of $100 each, at a premium of 10 per cent. He receives $450, but gives security for $500, on which he pays dues and interest.

Illustration II: In this case the borrower receives $500, but gives security for $550, on which he pays dues and interest until the shares reach the value of $550, unless previously repaid.

The number of associations operating under this plan is as follows: LOCAL.– Alabama, 1; total local associations, 1.

PLAN 68.

Loans are awarded to shareholders bidding the highest premium. The premium is either deducted from the loan in advance or the borrower receives the full amount as may be agreed upon. If the premium is deducted, the borrower receives the remainder, but gives security for the gross amount and pays interest thereon. If the borrower receives the full amount of the loan, he gives security on both loan and premium and pays interest on the same. In either case the principal is reduced periodically by the amount of dues paid in on the shares borrowed on, and interest is charged on the remainder. No rebate of premium is allowed in case of the repayment of the loan before the maturity of the shares.

Illustration I: A member secures a loan on five shares of a maturing value of $200 each, at a premium of 10 per cent. He receives $900, but gives security for $1,000. His monthly payments for the first three months are as follows: Dues, $5; interest on $1,000 at 6 per cent, $5; total, $10. At the end of three months the principal is credited with $15, the dues paid in, leaving $985 principal, on which interest is charged. Monthly payments during the second quarter are: Dues, $5; interest on $985 at 6 per cent per annum, $4.924; and so on, reducing the principal each quarter until the loan is discharged.

Illustration II: In this case the borrower receives $1,000, but give. security for $1,100, on which he pays interest at 6 per cent per annum. His monthly payments for the first quarter are as follows: Dues, $5; interest on $1,100 at 6 per cent per annum, $5.50; total, $10.50. At the end of three months the principal is reduced by $15, leaving $1,085 principal, on which interest is charged. Monthly payments during the second quarter are as follows: Dues, $5; interest on $1,085 at 6 per cent per annum, $5.42); total, $10.421; and so on, reducing the prin cipal each succeeding quarter until the loan is discharged.

The number of associations operating under this plan is as follows:

CHAPTER IV.

PLANS OF DISTRIBUTION OF PROFITS.

425

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