1893 - State Library Information Center

452 STATISTICS OF LABOR AND INDUSTKIES.1it the borrower is very often seriously embarrassed by this deduction;he cannot calculate with any certainty how much moneyhe will get until after he has bought the money, and then probablyfinds that he has too little, and, unreasonable though it be,he will blame the association for getting him into this unpleasantposition. That last one hundred dollars is the very hardestto get, and it is not unlikely that he and his friends may notspeak highly of building and loan association schemes. It j$unjust, because he is required to pay interest upon an amountwhich he does not receive, so that besides the actual loss of premiumhe is actually paying from 6$ to 8| per cent, annualinterest on the cash received, though he was of the opinion thathe had only 6 per cent to pay. From experiences of this kind Ihave known many would-be borrowers to refuse to borrow *fromtheir association, and, indeed, to condemn all building and loanassociations, and to turn to private capitalists who would sellthem the lot and build the house for them and charge themactually smaller monthly payments for the period of ten yearsthan their friends were paying in their so-called mutual association.Then, by this plan, there is great difficulty in keeping the.accounts of the association. We have earned and unearnedpremiums, transfers when the loan is repaid, &c, and, when theassociation is serial, the trouble is increased, and there is sure tobe uncertainty, if not confusion, in the minds of the directorswhether all these figures and calculations are correct I haveseen a good many annual reports that I am quite sure no one butan expert accountant could have stated positively that they werecorrect. Many of them, I know, are arrived at in a purelyarbitrary manner, which may or may not be just to the borrower,but is always sure to be for the benefit of the investor or for theassociation, as it is said; as though the borrower were not a verynecessary part of the association! Of course the secretarybelieves that all of his calculations are quite correct; nay, he mayeven be quite positive of it, but the secretary, though absolutelyhonest and careful, is only human, and is liable to make a mistake.Then, who can correct it ? I insist that at least the auditingdirectors shall knor that the accounts are right and shallBOcertify. But it i& not to be expected that they are all experts, or