ltn il< ling Societies their Working and A dvantages 6 1 



Generally a small entrance fee of about Is. per share 

 is charged, and the dividend varies, but may be about 

 4 or 5 per cent. 



Building societies also receive deposits or loans from 

 members or other persons, but the amount owing at 

 one time must not exceed two -thirds of the value of the 

 property that has been mortgaged by the members. 

 Thus a building society will receive deposits in sums 

 varying from 1 upwards for any period, at an agreed 

 rate of interest. As a rule the rate of interest to 

 depositors is less than that paid to shareholders, and 

 when members wish to withdraw either the whole or 

 part of their deposits, they must give notice of perhaps 

 a month, according to the rules. 



Now let us turn to the borrowing department of a 

 building society, for it is on the character of the 

 advances made to borrowers that the success of its 

 members depends. We will suppose that a man wishes 

 to buy a house worth 300 for his own occupation, 

 and has managed to save rather more than 100. 

 Now it is obvious that he wants at least an advance of 

 200, and for this purpose he applies for a form on which 

 he gives various particulars relating to the property. 

 He then returns this form with a fee, and the property is 

 carefully surveyed by the agents of the building society. 

 If the property is worth taking over the applicant is 

 advised what advance can be made. We will suppose 

 that 200 is advanced and that the borrower is willing 

 to repay this sum with interest at 5 per cent, in 14 

 years. This means that every month for 14 years the 

 borrower will pay a fixed sum of 1. 13s. Sd., and then 

 at the end of that period the house will be his own 

 property. In most societies borrowers have the option 



