mium for it, and the highest bidder secures the money by agreeing to pay (if on what is called the instalment plan) so many cents per month per share for each month the loan has to run. To secure a loan of $200 if the premium paid happens to be 40 cents per share the monthly payments would be as follows:

Interest, $1 per month; premium, 40 cents per month, and dues $1 per month or a monthly total of $2.40.

The $1 for interest and the 40 cents for premium find their way into the profit account of the association. The dues are always the property of the shareholder. When a loan is secured the shares are held as collateral security and cannot be withdrawn until the loan is repaid at or before maturity of the shares.

These payments are kept up for say, one hundred and forty months or one hundred and twenty-six months, until the shares reach the value of $200.

With a premium of 40 cents per share it will be shown elsewhere that maturity takes place after payment of one hundred and twentysix months' dues, depending on the profits of the society. One hundred and twenty-six months' dues, at $1, Gain or profits of term,

Total value,

$126 00

74.00

$200 00

At this point a settlement is made and it is found that the borrower owes the society $200, which he borrowed one hundred and twentysix months ago, and the books also show that the member or investor is entitled to $200 from the society by reason of the shares having reached that value.

Now the borrower must pay to the society $200 and on the other hand the society must pay to the investor $200. Good book-keeping will not admit of simply calling these accounts square, and the process by which the accounts are settled is as follows:

The secretary draws an order for the matured shares, making a careful list of its book number series, etc., and charges the same in his cash book. This order is handed to the owner of it (who in this case happens to be a borrower), who endorses it, signs a proper release of the shares to the association and hands the order back to the secretary (as cash) to be used for the repayment of the loan. This sum is entered in the cash book as a receipt from a loan paid off. These entries find their way through the books of the association. While every borrower must be an investor many members are simply investors, and not borrowers. The investor receives in cash $200 per share the moment the borrower is freed from his debt.

Shares.

A share of stock, so called, is the accumulation of one dollar per month, until a final value of $200 is reached, by adding together the

Members.

All who join a building association are required to contribute one or more dollars per month, according to their saving ability.

Dues.

In building association language these monthly deposits are called dues.

Monthly Receipts.

The monthly receipts are loaned to members (only) in sums of $200 or its multiple.

Investors.

Strictly speaking, there is no class of "investors" in American societies. But all members, whether they borrow or do not borrow, are investors. If they borrow they become known as borrowers so that those who do not borrow may, for convenience, be called investors. It should be remembered, however, that an investor may become a borrower, and that a borrower, by repaying his loan before maturity, may return to his former status as a non borrower or an investor.

Borrowers.

Those who borrow are required to furnish satisfactory security (real estate or society stock), and for each $200 borrowed, they are required to pay one dollar per month interest, besides the other dollar which is paid towards a future share of stock, which is to become worth $200.

Free Shares.

Free shares is a technical term applied to those shares upon which no loan has been made.

The Settlement.

When the monthly deposits or payments and gains make each share of stock worth $200, the share of the borrower cancels the debt of $200 which he owes to the society. The member who has not borrowed is entitled to and receives his $200.

The Partnership.

The gains are divided so that all the money invested, as dues, by all the members receives a like per cent. per annum for the average time of investment.

Withdrawals.

The members may withdraw their deposits (when not pledged for loans) after thirty days' notice and receive all they have paid in, with their proportion of gains added.

Payment of Loans.

The borrowers may repay their loans at any time, and use in part payment their deposits with gains added. The borrowers may also repay their loans in instalments of $100 or $200 and withdraw if say $200 is paid.

The above is a simple sketch of the scheme.

Their American History.

It is believed that Frankford, now a part of Philadelphia proper, saw the first building association that was organized in the United States. It was called the "Oxford Provident Building Association," and was started in 1831, fifty-seven years ago. It closed its affairs in June of 1841. The second Frankford association, of the same name, was organized in February of 1841, and ran out in August, 1852. Isaac Whitelock was president, Samuel Pilling, treasurer, and Isaac Shallcross, secretary, of the first Frankford; and Henry Taylor, president; Isaac Shallcross, secretary, and William Overington, treasurer, of the second Frankford. The Holmesburg Building Association was organized in January, 1842, and closed its business satisfactorily to the members June 25, 1853. There has been considerable dispute as to which was really the first building society in Philadelphia. Some years ago the following appeared in the Public Ledger: "At the organization of a new building and loan association last Saturday evening, Mr. John B. Duff, exhibited an old yellow "poster" in a gilt frame, and said it was the public call for the first meeting of the first building association organized in Philadelphia. The meeting was called to assemble at the Kensington Engine Hall, on Queen street above Marlborough street, on Friday evening, January 22, 1847. Mr. Duff signed the call and helped to organize the society, the Kensington. The Kensington issued five hundred shares of stock in one series, and wound up its shares in ten years and two months after it was organized. The first published advertisement of any building and loan association appeared in the Ledger, February 5, 1847, and called for a meeting of this Kensington Association. In the Ledger for 1857, advertisements of four or five such associations appear almost every day."

This led to a number of communications on the subject one of which referred to Mr. Duff as follows: "If Mr. Duff had displayed as much interest in looking up the statistics of building associations as he has shown in preserving the yellow poster, he would have found that building associations were organized in Philadelphia, many years before 1847."

Mr. Duff, however adhered to his statement in the following letter addressed to the public:

"The fact that I did take the trouble to hunt up the statistics, justifies me in saying that I have done something more than preserving what I cannot help regarding as an interesting "yellow poster." In January, 1872, the Building Association Journal published a history of these associations in this country, which was taken from the Frankford Herald. The main points of the history are as follows: It is supposed that building associations originated in Scotland about the year 1815, thence they spread to England, and in 1831, some gentlemen living in and near Frankford, who had become acquainted with the

Building Association of Frankford. The dues were $3.00 per share, per month, and the par value of each share $500. The society organized January 3, 1831, and run ten years and six months. A new society of the same name was formed and was followed by another called the Franklin, with dues $1 per share, and the par value of each $200. In the summer of 1846, I was building a house on Trenton turnpike, above Frankford, and boarded with a man named Richard Travis, at whose house I saw a copy of the Franklin Society's constitution and by-laws. When I returned to Kensington, in the fall of the same year, I endeavored to organize a society there, and, as a result of my labors, the Kensington Building Society was formed January 22, 1847. I did not mean that the Kensington was the first society of the kind within the old county of Philadelphia, but simply that it was the first within the compactly built up city of Philadelphia. As Philadelphia was known at that time, I was instrumental in having the first of these societies in the city proper organized."

The writer of the above letter, John B. Duff, died in 1883, after having served as an officer in many building associations for thirty-six years. Mr. Duff seldom, if ever, held forth in public, but his efficient work was done by taking individual cases and converting them to the benefits of obtaining homes for themselves. Frequently he has been seen on a pile of lumber (he was a lumber counter) with chalk in hand, demonstrating a problem in building association arithmetic to converts to this system of saving. The old yellow poster is still in existence, having been presented to the editor of the Building A880ciation and Home Journal by Mr. Duff just before his death.

Their Early History in England.

From a work published by Henry N. A. Davis, London, and other sources, the following information is obtained concerning building society history:

The earliest authentic information on the subject shows that associations for enabling the subscribers to build on purchase dwellinghouses were known in Birmingham so far back as the year 1781. In Mr. Langford's "Century of Birmingham Life," there is mention made of certain proposals for establishing a society for building on lands belonging to William Jennings, Esq. The society was governed by rules or articles, from which the following extracts will show the nature of the scheme:

III. That each subscriber for three shares shall have one or more houses built of the value of 200 guineas, and each subscriber for two shares shall have one or more houses, value £140; and each subscriber for one share shall have a single house, value £70.

IV. That the rents and profits of the said intended buildings be paid into the hands of the treasurer and added to the general fund of stock.

V. That the committee shall have power to contract for the leasing of the lands intended to be built upon in such proportion as they shall think proper, and for such terms, not less than 100 years, and subject to a ground rent not exeeeding three half pence per square yard.

VII. That the land intending for building upon shall be laid out in lots and balloted for by the subscribers, and separate leases made and executed, but such leases to remain in the hands of the committee till the proposed buildings are completed. There were to be monthly subscriptions of 10s. 6d. per share; a committee of management was to be elected annually, and rules were from time to time to be made by a majority of the members. In the main this appears to have resembled the more modern land societies. Whether or not it met with success is not recorded. A few years later, in 1795, mention is made of "building clubs," evidently well-known bodies, having made a be ginning on a certain newly endorsed trust in Birmingham upon a scale of twenty houses and gardens to an acre of land.

In January, 1809, the Greenwich Union Building Society was founded upon a deed of rules and regulations some of which have been preserved in the report of certain legal proceedings to which its transactions gave rise. The object was stated to be the raising of a fund, by the monthly subscriptions of the members, which was to be laid out in building houses and the dividing of the same among the subscribers, under and subject to the rules. By the first article it was declared that the society should consist of no more than fifty members, holding in the whole not more than 200 shares of £210 each. The third article declared that the members should meet on the first Thursday in every month, when the books should continue open for two hours, and each member should pay two guineas on every share held by him until £210 should be paid for each share, such payments to be made to the treasurer.

The fourth article provided that any member neglecting to make his payment at such meeting should forfeit 2s. 6d., and if such arrears and forfeitures were not paid at the next meeting then he should forfeit 58., and for a third default, 10s. 6d., and if, after notice, he should still neglect to comply with the articles, he should be excluded, and the money advanced by him forfeited, unless he should provide a person within three months from his last default who would be voted eligible to become a member by the society, in which case the member selling his shares should forfeit ten per cent. upon his subscriptions, for the benefit of the society, unless the default appeared to happen from the misfortune of the person so selling his shares.

By the fifth article the members were to draw lots from time to time as often as the funds amounted to £100. By the eighth, ninth, tenth and eleventh articles every share should consist of a dwelling