§ Mr. Bray
asked the Secretary of State for the Environment if he will seek powers to introduce a preferential mortgage repayment scheme for first-time home buyers which will maintain a level of 2½ per cent. below the normal applicable or then current mortgage interest rate, which latter rate shall not be deemed to fall below 7½ per cent., so that the benefit of such preferential interest rate shall continue for a period of five years from the due date of the first repayment.
§ Mr. Channon
My center hon. Friend the Prime Minister announced on 8th October that discussions were taking place with mortgage lenders on a selective scheme for first-time house purchasers based on the deferment of interest. Under 465W this scheme, at present mortgage interest rates, the gross mortgage interest rate would be reduced to 8.5 per cent. in the first year with a progression over the first few years of a loan to the full rate normally payable. The gross mortgage interest rate payable is already substantially reduced in practice by tax relief on mortgage interest or the option mortgage subsidy.