Challenge Weekly Article
Trust lends $16.1m at no interest
Challenge Weekly 9 March 2009, Vol 67, Iss 8, page 1
An organisation which loans mortgage money interest-free has now advanced $16.1 million to 225 homes throughout New Zealand.
Now in its 20th year, Whakatane-based Liberty Trust has assisted families and churches from Kaitaia to Invercargill. When people join, they are asked to make a donation, which can be one-off or regular payments. After 5 to 10 years - whichever period the member nominates - they are offered an interest-free loan, based on the amount they have contributed.
"We are asking people to first of all donate to help others, and then they'll receive a blessing themselves," says treasurer Kerryanne Dalgleish.
The more a member puts in, the more they can draw down for a loan. It is totally self-selecting and voluntary.
A person putting in $80 a week would be offered a loan of $200,000 in 10 years. Some start off a small account for their children or grandchildren, who can take it over themselves when they start working.
"Instead of getting an instant loan and paying the cost - and often it's for the rest of your working life - you're doing things the other way round," says Ms Dalgleish.
The benefits are staggering. If a couple took out a $200,000 bank mortgage for 30 years at seven per cent interest, they would pay the bank $279,000 in interest alone, with total repayments amounting to more than double the actual amount borrowed.
Without that hefty interest repayment, most people borrowing from Liberty repay their loan in seven years, which is the whole point of the organisation.
"Most people take until their 30s to save for a deposit for a home. So all their working life is spent with this burden of debt," adds Ms Dalgleish.
"We want to see people set free to do whatever God wishes them to do with their money ..."
by John McNeil