14 
Table VI. — Purchasers classified according to promotion of price raised on 
second mortgage and relationship to former owners. 
[Giving of mortgages coincident to the purchase of farms, and first mortgages held by Federal land banks.] 
Number 
of 
records. 
Holders of second mortgage- 
Per cent 
of all 
records. 
Former owners. 
Not 
former 
owners. 
(107 
records). 
Per cent second mortgage is to total cost of the farm. 
Related 
to the 
pur- 
chaser. 
(32 
records). 
Not 
related 
to the 
pur- 
chaser 
(388 
records). 
1 to 25 
167 
157 
105 
98 
32 
30 
20 
18 
Per cent. 
10 
34 
25 
31 
Per cent. 
26 
30 
22 
22 
Per cent. 
60 
26 to 40 
27 
41 to 50 
9 
. 4 
PERIOD OF REPAYMENT OF SECOND MORTGAGES. 
By placing as large an amount of the cost of the farm as possible 
on first and second mortgages, the purchaser who is short on cash 
husbands his resources so that he may have enough on which to 
operate his farm. But the conditions of repayment on his mortgages 
should be such that he will not be embarrassed in meeting the pay- 
ments. 
On the first mortgage given to the Federal land bank he must pay 
6-J per cent each year (if the mortgage was given on or after Decem- 
ber 7, 1917), this amount sufficing to pay the interest due each year 
and to reduce the principal so that in 31-| years both principal and 
interest will have been fully paid. The payments on the Federal land 
bank loan are made annually or semiannually, and the comparatively 
small payments to be made at any one time should not embarrass the 
borrower. 
Table VII shows the time by which the second mortgages were 
found to be fully payable as shown by 576 second mortgages made 
in connection with the purchase of farms on which loans on first 
mortgages were obtained from Federal land banks. Two out of every 
10 of these second mortgages were payable in full by the end of the 
second } 7 ear and seven out of every 10 by the end of the fifth year. A 
larger number of second mortgages were payable in full by the end 
of the fifth year than by the end of any other period, 29 per cent 
having the fifth year specified as the date of final payment. Only one 
out of every 20 was not fully payable by the end of the tenth year. 
A larger proportion of the buyers who borrowed on second mortgages 
from relatives were allowed longer than two years than in the case 
of those who borrowed from others than relatives, and a larger pro- 
