1912. 
GERMAN AGRICULTURAL CREDIT SYSTEM. 
Part II. 
LAND MORTGAGE ASSOCIATIONS.—In a pre¬ 
vious article I told of how well organized the fanners 
of Germany are for the purpose of making loans at 
favorable rates of interest. The most important or¬ 
ganizations they have for this purpose are the land 
mortgage associations, or so-called “Landschaften” 
societies. These were first organized in the latter 
part of the eighteenth century (the first one in 1769) 
by the nobility and large land owners of eastern Ger¬ 
many for the purpose of making loans at lower rates 
of interest than they were able to make them in¬ 
dividually. From the beginning they were public in¬ 
stitutions, and under the control of the government. 
These organizations were so successful from the be¬ 
ginning that they have been continually extended and 
the minimum amount of the loan they will make de¬ 
creased until at the present time they serve all of the 
farmers, except the very smallest. The land mort¬ 
gage associations are a cooperative organization of 
farm owners organized for the purpose of serving as 
mediator between persons having capital to loan and 
farmers desiring to borrow the same. They are self- 
governing under direct control of the government, 
and are not operated for profit. They have been or¬ 
ganized for the most part for a province, a district 
which is a political division between our county and 
State in size, and any landowner within the province 
can become a member provided his property is worth 
not less than the minimum amount on which loans 
will be made. This amount varies in the different 
associations. 
TERMS OF THE LOAN.—The loans of these so¬ 
cieties carry certain conditions which make them es¬ 
pecially favorable to the farmers. 
1. The rate of interest at which they are made 
cannot be raised. 
2. They cannot be called in except for specific rea¬ 
sons, such as the waste of the property or flagrant 
misuse of it, which is very unusual. 
3. The farmer has the right to pay back his loan 
in part or in whole at any time upon giving notice the 
required length of time in advance, which is never 
over six months. 
4. In addition to the interest, one-half to three- 
fourths per cent of the loan must be paid annually 
which applies on the principal, and in this way the loan 
is gradually paid off. By the payment of three-fourths 
per cent the loan will be paid off in 40 to 45 years. 
Under these terms the farmers have the advantage 
that when the loans have been made at low rates of 
interest the rates cannot be raised or the 
loans foreclosed, but if they have been 
made at; a high rate, as was the case in 
1860-1880, when the rate rose to five 
per cent, they can be paid off when the 
rate falls, by refunding the debt through 
new bonds. In fact, this has been done 
to such a large extent that it has in¬ 
jured the sale of the bonds on the mar¬ 
ket to some extent, and they now usu¬ 
ally sell below government bonds. 
A TYPICAL LAND MORTGAGE 
ASSOCIATION.—The best idea of the 
working of these associations can prob¬ 
ably be secured by taking a typical ex¬ 
ample. In Halle, where I am located, 
there is the Mortgage Association for 
the Province of Saxony, which is about 
10,000 square miles in area, or about 
one-fifth as large as New York State. 
This association was established in 1864 
and now has loans amounting to $20,- 
000,000. Any farm property owner in 
the Province who pays at least $22.50 
per year land tax can become a member 
of this association. He is entitled to 
borrow through the association to two- 
thirds the appraised tax value of his 
farm upon giving first mortgage on the 
same to the association. This is a 
legal right that he has, and may not be 
refused as might be done by a private 
bank or association. He is entitled to 
the loan without question as to how or 
for what purpose it is to be used. There 
are also provisions for appraisement of the property 
by representatives of the land mortgage association 
when the farmer prefers it, but it is more expensive 
and is not the method generally used. After the 
amount has been determined that the farmer is en¬ 
titled to borrow on his property, he can choose the 
rate of interest that he wishes to pay, and the bonds 
will be made out by the association bearing the de- 
THE RURAL NEW-YORKER 
sired rate of interest and put upon the market. At 
present the rates that are being used are three per 
cent, 3 l / 2 per cent, and four per cent, and so far as the 
individual farmer is concerned it does not make much 
difference which he chooses, because the price at 
which the bonds sell depends upon the condition of 
the money market. If, for example, a farmer chooses 
to pay only three per cent when the current rate of 
£ 
HOMEMADE LIME SPREADER. Fig. 
interest on such securities is four per cent, the bonds 
will be discounted and he will not get as much as he 
gives his mortgage for. If, on the other hand, he 
chooses to pay four per cent when the current rate of 
interest is only 3 l / 2 per cent the bonds sell at a pre¬ 
mium so that he will receive more than he has given 
his mortgage for. As a rule the rate of interest that 
the bonds are made out for is the current rate as 
48 7 
five per cent and the three-fourths per cent goes di¬ 
rect toward payment of the principal, and what is not 
needed of the one-fourth per cent to cover adminis¬ 
tration costs, is also applied on payment of the prin¬ 
cipal. When the farmer has paid in 10 per cent of 
the original loan he can claim release of this amount 
in his mortgage, or, if he desires, may have a new 
loan equal in amount to the 10 per cent granted to 
German Government Rand Association 
3%% B ( " 
1900 . 95.80 
1901 . 99.54 
1902 . 102.06 
1903 . 102.30 
1904 . 101.94 
1905 . 101.33 
1906 . 
1907 . 
1908 . 
1909 . 
1910 . 
him. The advantages of the whole 
summed up as follows. It gives the 
long time loan on which the rate of interest cannot 
be raised or the loan called in, and the debt is. paid off 
gradually in small annual installments. H. c. price 
Halle a. Saale, Germany. 
< 2 % Bonds 
3 % % Bond: 
95.80 
95.00 
99.54 
97.50 
102.06 
99.97 
102.30 
100.95 
101.94 
100.90 
101.33 
100.90 
99.50 
99.37 
94.30 
94.00 
92.50 
92.35 
95.15 
94.20 
93.95 
91.50 
system may be 
farmer a cheap 
r*- - 
AXLE OF LIME DISTRIBUTOR. 
END VIEW OF LIME SPREADER. Fig. 170. 
near as can be determined so that they can be sold at 
par. The variation that there has been in the rate of 
interest since 1900, as well as the relative price at 
which German government bonds and land mortgage 
association bonds have sold is shown in next column. 
By such a system the farmers get the benefit of 
the variations in the money market, which is seldom 
STRAINER FOR LIME-SULPHUR CONCENTRATE. Fig. 171 
HOME-MADE LIME SPREADER. 
At this time we have more calls for a successful 
lime spreader than for any other farm machine. The 
use of lime is increasing, and will go much faster with 
a machine to save the nasty work of spreading by 
hand. Two years ago we described a homemade ma¬ 
chine made by our correspondent, C. S. Greene. A 
number of our people built such a machine and praised' 
it highly, so we repeat the description and pictures. 
1 he accompanying drawings, Fig. 170 arid above, 
show the axle, which is the most important part. The 
axle of an old mowing machine is first cut in two 
and made as long as the machine is to be. Five col¬ 
lars are then shrunk on to the axle equal distances 
apart, in such a manner as to hold the four feed bars 
about one inch from the axle; one by three-eighths 
inch iron feed bars are then fastened to the collars 
with tap bolts, and the heads cut off and riveted, mak¬ 
ing a cylinder which acts as a force feed when re¬ 
volving with the wheels. The same wheels and 
ratchets are used that were on the old mowing ma¬ 
chine, so it can be put in and out of gear. Fig. 169 
shows the machine as it appears when completed. The 
sides of the hopper are constructed of lJ4-inch lum¬ 
ber and the ends are made of two-inch hard wood 
with iron plates screwed on where the axle passes 
through, to prevent wearing. Fig. 170 shows the end 
with dimensions. The inside of the hopper is made 
one-half inch longer than the force feed 
cylinder, so it will work easily. The 
ends and sides of hopper are made 
separately and put together on the ma¬ 
chine. The whole bottom of the ma¬ 
chine is then covered with heavy gal¬ 
vanized iron with a lx2-inch hole every 
six inches, and over this a false bottom 
is placed so it will slide toward either 
end to regulate the feed. This false 
bottom is held in place with three straps 
made of hoop iron, fastened to. the 
sides of the hopper, and worked with a 
lever at the back. The force feed must 
work very closely to the holes in the 
gah a ni zed iron to prevent clogging. 
The pole is bolted to a 4x4-inch stick 
as long as the hopper. This stick is 
fastened 18 inches in front of hopper, 
by bolting it solidly to the two draft 
irons made of two by one-half inch iron 
at each end, through which the axle 
passes, and two heavy braces which hold 
the hopper in position as shown in the 
picture. 
A VIRGINIA HOMEMADE LIME-SULPHUR COOKER. Fig. 17 
the case where loans are made through banks or pri¬ 
vate individuals. 
COST IN ADDITION TO INTEREST.—In addi¬ 
tion to the interest, in the Saxony Land Mortgage 
Association, one-fourth per cent of the loan is added 
to cover administration costs of the association, and 
three-fourths per cent to apply upon the loan, so that 
if the loan is made at four per cent the farmer pays 
A LIME-SULPHUR COOKER. 
1 he “plant” shown in Fig. 172 is op¬ 
erated by Dr. S'. S. Guerrant, of Frank¬ 
lin Co., Va., ex-president of the Vir¬ 
ginia Horticultural Society, who says: 
“Two large kettles mounted in a flue 
with water running in by gravity; tank 
to left of 200-gallon capacity, from 
which spray tank is loaded, all by grav¬ 
ity, all under cover. We make the concentrate on 
wet days. Note the box over the barrel; this is a 
strainer that strains from the bottom and you have 
no trouble with the sediment.” 
Wh have not been able to get a good catch of clover 
and grass when seeded with oats and peas. If the latter 
crop is what it should be the seeding is usually smothered 
with us. Some of our readers, however, report good suc¬ 
cess with such seeding. 
