The News-Herald. [volume] (Hillsboro, Highland Co., Ohio) 1886-1973, 1907-05-23
AVERAGE RATE OF INTEREST.

From July to Dec 81, 1904. .s174, ,slB, ,o1s
From Jan. 1 TO June 30, 1906. ass. SOC, 1877
From July TO Dec. 81. 1905. 101 1853, ,65s
It will be observed that the rate Of
interest did not rise In New York by
quite a full half per cent. This was
because the interest rate in New York,
prior to the 1905 law, was somewhat
increased by the liability of mort
cages to taxation as personal property.
The falling off of the amount Of
money loaned was very great In the
county of New York.
In 1905 the law was 80 amend
ed as to provide for one single
tax at that time of record, imposed on
all mortgages recorded on and after
July 1, 1906. All mortgages made on
and after that date have been liable
to a single recording tax Of one-half
Of one per cent, and are thereafter
exempt from all other taxation. The
effect of this change in the law i'm
mediately appeared both in the de-
cline in the rate of interest and In
the increase in the amount of money
loaned. I present the figures for the
first six months Of the operation of
the new law in New York county and
the figures for the corresponding
period of 1905 for comparison:
Money Rate
Loaned Of Int.
July I to Dec. 81. 1905. s101, ,159.B5s S.54
July to Dec. 81. 1905. 222.56s.Ies' S.fs
During the las six months of 1905 a
mortgage for 800. .000, 900 at ~ per cent
was recorded but this In not included In
the above amount nor In the computation
of the rate of interest.
All these statistics were made up In the
following way: The total amount OF
mortgages recorded at each rate Of in
terest was separately stated and the In
terest computed at that rate. The total
interest charge on all the mortgages was
computed and then divided by the
amount OF money loaned. These stats
tics abundantiy prove that every obsta-
Gle placed between the borrower and
lender OF money. and any burden placed
upon the transaction must fall ultimately
upon the borrower Of money.
The old law I'm the state OF New Yorl,
was most unjust to those dependent upon
estates In trust, because trustees were
limited in their investments to mortgages
on reel estate, and nominally ali such e.
tates were fully assessed and taxed. II
was common for one-half OF the income
OF a trust estate to be conhscated by tax
alton. The annual mortgage tax law OF
1905 relieved lenders Of this fearful bur-
den, but II imposed a certain charge OF
ons-haif Of per cent on borrowers. IN
addition to the economic rate OF interest.
While the present recording law 10 moi
theoretically Just because II imposes
some additional burden on those who
borrow, II In Infinitely to be preferred to
the greater burden OF the annual tax, OF
to the burden on borrowers imposed by
the liability of mortgages to taxation IA
personal property. and the awful fnJus-
tice to such lenders, chiefly widows and
orphans. who we're caught with mort
cages in their possession. and suffered
the connscation Of large share Of their
income.
The revenue from the recording tsx
during the nrst six months amounted te
| ti.8a8.3l7.
LAWSON PURDY.
President, Department Taxe1 and As
sessmsnts. City OF New York.
Notics.-Ohio readers OF the above
article viii hnd in II practical and sub
stantiai reason why they should work
for an amendment to the Ohio constitu-
ten that win make Il possible for the
| people Of Ohio, especially borrowers ol
| money. 70 enjoy the advantages New
Ycrk = obtaIning Aoa ~ nostesSp ~
| spsd1sg ~ iAw. F5-'
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