NO NEW MORTGAGES

Putaruru Press, Volume XII, Issue 563, 15 March 1934, Page 5

NO NEW MORTGAGES

ON FARM LANDS A Morrinsville Proposal Plan to Repay Indebtedness Proposals for repaying existing short-term mortgages on farm lands by the adoption of long-term table mortgages were outlined by Mr. R. A. S. Browne in his presidential address at the annual meeting of the Morrinsville branch of the Farmers’ Union on Saturday.

Mr. Browne was emphatic that no new mortgages on land should be permitted, his aim being to wipe out all mortgages in due course. “ The huge mortgage indebtedness in New Zealand on lands used for obtaining a livelihood from the soil must be faced,” said Mr. Browne. “ These mortgages have a stranglehold on this and succeeding generations, as it will be impossible, under existing conditions of recurring crises, either to pay off these mortgages or, indeed, to meet moneys in full from time to time. Even in normal times there is the constant doubt and fear of non-renewal, and constantly-recurring legal expenses on renewal.

“ Legislation so far introduced has succeeded merely in putting off the evil day in such a way as to cause a complete loss of confidence in the value of all rural securities. How the Government intends to meet this situation no one knows—not even the Government itself.”

Mr. Browne suggested that the mortgages themselves be left intact, but that

(1) Interest rates be reduced to 3 per cent, at present with i per cent, sinking fund, and that according to the rise in the returns from key primary industries in New Zealand the rate of interest should vary between 3 per cent, and 5 per cent, as decreed by Order-in-Council from time to time. It is anticipated that present values for butter and cheese are bedrock values, hence there is no suggestion that the rate of interest should go below 3 per cent. (2) All mortgages on land to become long-term mortgages. (3) No new mortgages on land be permitted.

(4) If and when possible a Gov-ernment-guaranteed long-term loan at low interest be raised on the security of the lands affected by the mortgages, and that repayment of principal be made to mortgagees. Australia had been able recently to secure money freely at 3S per cent., or thereabouts, on no better security than could be offered in New Zealand, added Mr. Browne.