Show NEW CLASS OF 1 PAPER FINDING FAVOR FAVORIN IN EAST Organization to Aid d Auto I Purchases Is Popular Boston BOlton I Feb eb 8 The Th organization of ot discount corporations to assist In financing of automobile purchases has created a new class of ot paper which Is la the banks bank finding finding- great Crent favor or among among- because of at Its proved self liquidating Responsible purchasers sers of ot new passenger passenger pas pas- automobiles of ot approved makes from dealers of approved credit who havo have paid third one-third or cr more moro of at tho the purchase pur- pur chase price In cash obtain the balance I of the tho purchase price from a n discount corporation In notes payable in monthly month month- ly Jy Installments not over ten in num nurn- ber bor Tho notes aro arc secured b by lien on tho car are signed Bignel b by tho the purchaser and endorsed by bytho the tho dealer The car Is Insured against fire tIre theft collision and also against wrongful conversion i. i e. e absconding mortgaging or selling the car The Tho discount company deposits these notes with a trustee and from time to time Issues Its Us own collateral trust n un I. I n O n. n t V u. u vv v of at tho the amount of Instalment notes In trust These collateral notes of tho the corporation aro are Issued with maturities from three to twelve months and are readily discounted b by banks banks banks-aU all over tho the country countr Thirty One Ono of or tho the companies operating under under un un- un- un der this plan reports In less than two and one half years cars of at operation only thirty repossessions out of or 39 cars bought on this plan A similar plan pl la Is applied to finance tho the purchase of or cars c at wholesale by dealers In this case tho the discount corporation corporation corporation cor cor- takes trade trado acceptances representing not moro more than 90 per POl cent of oC tho the price accepted by re responsible responsible ro- ro dealers and endorsed b by tho the manufacturer or or if It tho the acceptance Is drawn b by a distributor then guaranteed guaran guaranteed guaranteed guaran teed b by tho the manufacturer Title to the automobile Is retained by tho discount corporation under a L trust receipt accompanied accompanied ac ac- ac- ac companied b by a n. surety company's bond against an any improper disposition of at the cars These trade acceptances are similarly elm sim deposited with a a. a trustee and from time to time the discount company com corn pany issues Its collateral teral trust notes against them up to SO per cent of ot their am amount o U fl t Preferential Rate Because of oC the limitation on the re rediscount rediscount rediscount re- re discount privilege of ot tho the federal re reserve reserve re- re serve ser bank tho the trade trado acceptances themselves es aro are entitled to a n. preferential preferential prefer prefer- rate of ot discounting with the tho fed- fed fl 1 1 1 1 1 c y D VY vu IU w u utho tho ho collateral trust notes secured b by bytho tho tile acceptance ns as collateral For this reason quite a n number of at banks have purchased tho the trade trado acceptances direct Instead of ct the collateral trust notes The Ba same c c company aboyo rc referred to reports that out of oC new automobiles automobiles automo automo- I biles purchased b by dealers on this plan I it has been necessary to repossess only I t twenty five wen ty I Ie e I Further Indicating tho the liquid character charac charac- ter tel of oC these notes not eM tho the Continental Guaranty corporation reports that from Cram the tho time it began business In 1916 I I t to tc December 1 1 1918 tho tim total amount I of or notes and acceptances discounted by lit It that had matured was 5 I while tho the total amount collected was 5 Tho The reason that tho I amount collected actually exceeded tho amount collectible was that a n. fair perl per- per l of or tho the makers anticipate the II 0 obligations bI I gati o n s. s I e |