Building Societies - Definition - Law Dictionary Home Dictionary Definition building-societies

Definition :

Building societies, associations of persons subscribing to a common fund which is employed in making advances to such members (called 'advanced members') as desire to obtain them on the security of real or leasehold property, while those members who do not desire an advance (called 'investing members' ) simply pay their contributions to the society and receive interest thereon. Building societies are either (a) Unincor-porated, or (b) Incorporated. Unincorporated societies (now few in number) are governed by the (English) Building Societies Act of 1836 (6 & 7 Wm. 4, c. 32), and certain sections of the old (English) Friendly Societies Acts of 1829 and 1835 (repealed for all other purposes) incorporated therewith. Incorporated societies are governed by the (English) Building Societies Acts, 1874 to 1894, and the (English) Building Societies Regulations, 1895, made thereunder. A cross division of these societies is into (1) Terminating, and (2) Permanent. A Terminating Society is one which continues only until every member has obtained an advance and then comes to be end; a Permanent Society is one which continues indefinitely. Every society is governed by its rules, which must be registered with the Chief Registrar of Friendly Societies and form the contract between the society and its members. The form and operation of receipts by building societies for moneys paid on redemption of mortgages in England and Wales is now governed by s. 115 of the (English) L.P. Act, 1925. See Wurtzburg on Building Societies, and Davis on Building Societies, 5th edn.