GREATER RELIEF.

Star (Christchurch), Volume XLIV, Issue 375, 17 March 1932, Page 3

GREATER RELIEF.

Mortgagors’ Application to Court. EFFECT OF THE MEASURE. Though the Mortgagors and Tenants’ Relief Bill, if passed by the House, will afford a means of relief for those city mortgagees who are unable to meet their commitments in regard to principal and interest, it is considered by authorities in the city that the matter of dealing with all mortgagees on a fair and equitable basis will not have been accomplished until the Bill for a general reduction of interest, as forecast by the Government, has been brought forward and passed. z Mortgagors who, prior to the passing of the latter measure, have successfully appealed to the Court for a reduction, or have had their cases dealt with privately as between the mortgagee and mortgagor, will not, it is believed, be able to benefit also by the proposed general reduction.' Limitations for Relief. Before a mortgagor can obtain relief from rent or interest payments he must show conclusively that his outgoings for these commitments exceed his ability to pay, p*~d that his income has been so reduced by the financial stress as to make it unreasonable for him to pay the former rate. In such a Supreme Court proceeding, the applicant’s avenues of expenditure in directions other than interest come under scrutiny. The costs of application for relief have been kept as low as possible. Under the present Act no solicitor’s costs are allowed in the Court proceedings. The only costs involved are those between the applicant and his solicitor for preparation of the case. The present position regarding the Mortgagors Relief Act is that if the mortgagee wishes to exercise his rights against the mortgagor he must give a month’s notice. Within that month the mortgagor can apply to the Court for relief, setting out the specific grounds on which relief is claimed. In the new proposals it is suggested that the mortgagor can go direct to the Court for relief without waiting for the mortgagee to start an action. The granting of relief depends upon how far the mortgage is in arrear, the state in which the security is being kept by the mortgagor, and whether he is observing the covenants of the mortgage. Same as Farm Lands. The Court has w’ider powers for dealing with farm lands than w T ith city securities at present. In the case of farm lands the Court may postpone for not more than two years the date of payment of any principal or interest, and may also reduce the rate of interest or remit any arrears of interest due prior to the date of the Court making the order. Under the present Act, in the case of city securities, the Court can only suspend the mortgagee’s right of sale for twelve months. The new Bill proposes to extend the Court’s powers by bringing city securities under the same heading as farm lands. It is suggested by the Prime Minister that a general reduction in the rate of interest will be dealt with in another Bill. This will necessarily have a direct bearing on the relief given to mortgagors and lessees.