United increases mortgage rates

Press, 14 February 1986, Page 1

United increases mortgage rates

The United Building Society has become the second lending institution to announce an increase in mortgage interest rates.

Trusteebank Canterbury yesterday increased its interest rate for new mortgages to 21.5 per cent . United’s lending , rates are now 22.5 per cent for society members and 23.5 per cent for non-mem-bers. The move increases the difference between rates paid by non-members and members to 1 per cent Three , weeks ago, when United' announced it would make mortgage finance available to nonmembers, ' the interest offered was 23 per cent Shorter-term loans were available at the lower rates-of 15 years at 22.5

per cent, 10 years at 22 per cent, and five years at 20.5 per cent United’s public affairs manager, Mr Tony Kunowski, said yesterday that the rates to both members and non-mem-bers would still be subject to discounts if the mortgage was taken out for less than 20 years. The interest rate on a second mortgage is now 25 per cent for members and 26 per cent for nonmembers. A spokesman for the National Bank said yesterday that if mortgage interest rates continued to increase, the bank would have to consider staying with the market, but in the meantime its rate would remain at 18.5 per cent ■ > - . The Post Office Savings Bank has also announced

increased interest rates on key accounts, investment accounts, school savings accounts, and term deposits. No announcement was made about mortgage interest rates which are, at the moment, 16 per cent for a first mortgage and 19 per cent for a second mortgage. Interest on key accounts is now 11.5 per cent, while the new rates for investment accounts and term deposits range up to 18 per cent The 413,000 holders of school savings accounts will now get 11.5 per cent per annum. In the three years since February 1, 1983, interest on school accounts has increased more than 280 per cent. All new rates on Post Office accounts took effect on February 1.