ADVANCES TO SETTLERS.

Otago Witness, Issue 2368, 20 July 1899, Page 63

ADVANCES TO SETTLERS.

(Froii Oue Own Cokeespondext.) WELLINGTON, July 14.

The Government Advances to Settlers Act Amendment Bill provides that in order to encourage the early payment of the prescribed instalments of interest in, the case of fixed loans and of the prescribed instalments of principal and interest in the case of loans on the instalment system, the following provisions shall apply with respect to every instalment falling due after March 31, 1900: — (1) If the mortgagor (not being in arrears with any previous instalment) pays the instalment on or before its due date, or not later than the fourteenth day thereafter, he shall be entitled to a rebate of one-tenth of so much thereof as consists of interest, thereby reducing the rate of such interest to 4£ in lieu of 5 per centum. (2) Such rebate may be deducted by the mortgagor from the full nominal amount of the instalment. All moneys hereafter paid in advance by a mortgagor in

reduction ''of the mortgage debt shall_ be disposedoi''by the superintendent in the followj^ig manner : — {~l\ In the case of a fixed loan, in or towards satisfaction of the unpaid principal, or, if the mortgagor so directs, of the future instalments of interest in the order of their due dates. (2) In the case of a loan on the instalment system, in or towards satisfaction of the future instalments in the order of their due dates in mode A, or, if the mortgagor so directs, in mode B. Under mode A the moneys are to be used to pay instalments of principal, and under mode B for payment of instalments- of principal and interest. For tho purpose of giving greater elasticity to the existing provisions affecting loans, whether fixed loans or loans on the instalment system, the following provision shall apply in the case of every such loan, whether now current or hereafter' granted : — On the due date of any instalment after at least one-tenth of the principal has been repaid the mortgagor may readjust the loan by treating the balance of principal then unpaid as a fresh loan duly granted on that date for a fresh term, provided that in no case shall any loan be readjusted unless the balance of unpaid- principal at the time of readjustment amounts to at least £100. In the case of fixed loans, the margin of security shall be deemed to be sufficient if the amount of the loan does- not exceed three-fifths of the value . of the security. In tha case of loans under the instalment system of freehold security of firstclass agricultural land the margin of security must not excaed three-fourths of .-the value.

Advances may be made on the security of urban or suburban land, subject to the following provisions': — (1) The loan shall in evory case be on ' the -"instalment system. (2) Tht amount of the loan shall in. no case be lr-=-than £25 or more than £2000. (3) In the case of urban land, on which buildings^ pxi«l. the amount of the loan shall not exceed threefifths of tho value of the land apart from the buildings, plus one-half of the value of the buildings apart from the land. (4^) In tbf case of suburban land on which buildings -ex ist, the amount of the loan .shall not excesc one-half the value of the land, apart from th. buildings, plus one-half of the value of fh« buildings apart from the land. * (5) In the <.-d?: of urban or suburban land on which no buildings exist the amount of the loan shall no' exceed "one-Kalf of the value of the land, anc no loan shall be granted except for the erection of buildings on the land, the loan to be ■advanced by instalments at the discretion ot the board as the erection of the buildings proceed. - (6)-In no case shall any loan be granted on security of urban or suburban land that would' "not constitute) a lawful -security if it were other than urban or suburban land.

The bill contains special provisions for protecting, the superintendent's interests with respect to other than freehold securities.

j, A Christcllurcli firm some time ago (says the Lyttelton Times) issued an imitation five- | pound "note'a'B an advertising medium. Those ; accustomed to'" handle notes of various dei nominations would not readily be deceived • by it^ and , although several attempts - were made at the time of issue to. pass the paper at 1 hotel-bars ■and other places of business, no case -waff reported in which the note was. aot cepted. The paper has now, however, found ' its way into the country districts, and several complaints hav6 be'en madp regarding it. Iv one case a woman who keeps a small country store sold goods to .the value of 10s, accepted , the bogus note in her ignorance, and handed ' to the defrauder £4- 10s change, thus losing I the profits of a month at one stroke. Store- | keepers would be well advised/ therefore, to , examine all paper money carefully before acj cepting it.