Government Advances to Settlers Bill.

Manawatu Herald, 18 September 1894, Page 2

Government Advances to Settlers Bill.

We have cow a copy of the Bill introduced by ihe Hon. Mr Wai"d. Particulars have been published, hit the principle of repayment ap pt*ared misleading. Attached to the Bill is a schedule showing how the payments- made half-yearly will be credited for interest and for repayment of the loan; The term of the loan is fixed at 86$ -years, the interest at 5 per cent and one per cunt is charged on account _of principal. By paying six per cent, in two half yearly instalments, the borrower obtains a loan on the estimated f value of his. property and at the end of 36£ years the loan is paid off. -•_ This appears a most satisfactory arrangement. To give effect to it the Bill sets up a Lending Board, with local district boards who consider and deal with applications. The Government is given power to raise one and a half millions a year tor this purpose in the London market and in the colony. The fees to be paid by borrowers seem to have been fixed at a very reasonable scale being: — On application for loan not exceeding £200. 5s ; for loan exceeding £200 and not exceeding £500, 10s 6d ; for loan exceeding £500 and not exceeding £1000, £1 Is; and for every additional £1000, 10s 6d. The costs and fees for preparing mortgage shall be as follows (to be deducted from the advance) : — Law costs If advance be not exceeding £1000, 10s; if advance be over £1000, £1 Is; with cash disbursements, which are the same in every case, namely — search fee, 2s ; mortgage lorm, 2s ; registration, IO.*?. with an additional 2s for every certificate of title after the first. Costs and fees for discharge of mortgage, if discharged by the Aid to Settlers Office — Law costs, 5s ; registration fee, 55,. with an additional

mmmmmm*mmmmmmm^mmmmmmm»mm^mmmmmmmmmmmmm%% 2s for every certificate of title after the first. . The following classes of lands ia New Zealand may have money ftdVahced on them '•—... 1. Freehold Und held in fee* simple under the Land Transfer Act, 1.885, dr . t . 2. Crown land held oil rierpetitdl lease under the Land Act-, .1883, or 3. Crown land heia on lease ill perpetuity un-dei the Latid ..Act*, 1892, or . . ', 4. Native land held oil. leaje iti perpetuity under the West , -Co-sUfe Settlement Reserves Act, 18SI2. The Bill appears to be a fai ; better riWsiire thart we (.itfe-tefli more caution having been shown than was suggested in the first mention of the proposal, as by the half yearly payment off. the principal sum, the liability is thus each time so much reduced and by the time half the payments are made the principal stands at £70 instead of the £100. This may not appear clear without reference to the table so we will quote three instances ; on making the first payment of JS3 on the £100 loan, £_t 10s is credited to interest and Ids on account of principal ; on the 37th payment, £1 los 8d is credited to interest and £1 is 4d to capital; on the last 73 payment tenpence is credited to interest and £1 18s 2d to capital.

The Bill appears framed on the principle of a building society, but on a more liberal basis and without its ruinous fines.