FARM LAND VALUES IN IOWA. 



17 



Following is a summary of rates of interest on first mortgages: 



At 4^ per cent 1 



At 5 per cent 307 



At 5| per cent 4 



At 5$ percent 391 



At 5f per cent 1 



At 6 per cent 76 



It seems clear that practically all mortgages are either- for 5 per 

 cent, 5£ per cent, or 6 per cent, those made at 5£ per cent predomi- 

 nating, closely followed by those made at 5 per cent. 



The duration of second mortgages is shown in table XI. 



Table XI. — Second mortgages classified by duration of loan. 



Number 

 of years 

 to run. 



Number 

 of cases. 



Number 

 of years 

 to run. 



Number 

 of cases. 



2 

 3 

 4 

 4£ 



5 

 6 



7 



4 

 14 

 7 

 1 

 17 

 2 

 6 



8 

 9 

 10 

 12 

 15 

 20 

 33 



5 

 2 



28 

 3 



6 

 1 

 1 



As in the case of first mortgages, 5 years and 10 years are the out- 

 standing periods. The average duration for second mortgages is 

 6.6 years as compared with 7.7 years for first mortgages. 



Rates of interest on second mortgages are as follows: 



At 5 per cent 31 



At 5| per cent 56 



At6"percent 79 



At 7 per cent. 4 



At 8 per cent 3 



There seems to be a stronger tendency toward a 6 per cent rate 

 than in the case of first mortgages. However, the rate of interest 

 for second mortgages is not to a marked extent greater than for 

 first mortgages, the average being 5.7 per cent for second and 5.3 

 per cent for first mortgages. 



A few third mortgages were found, numbering, in all, 11. Four 

 of these were for 4 years, 5 for 5 years, 1 for 6 years, and 1 for 8 

 years. Seven were given at 6 per cent, 3 at 5^ per cent, and 1 at 

 5 per cent. 



A study of the terms of the loans indicates that on the whole 

 they are not more liberal in percentage of cash payment required 

 on purchase price than was the practice before the "boom." One 

 of the authors of this bulletin has made a comparative study of 

 terms of loans covering both periods * and has found that the per- 

 centage of average sale value required in cash during 1919 corres- 

 ponds very closely to the percentage required in the period before 

 the "boom." There appears to be a strong tendency toward con- 

 ventional rates of interest and periods of loans. 



i "Studies of Land Values in Iowa," by O. G. Lloyd, the Iowa Agriculturist, December, 1919, page 361, 

 184592°— 20— Bull. 874 3 



