THE LIMEHOUSE SPEECH.
[To THE EDITOR OF THE "SPECTATOR.")
Srs,—I have been a reader of and subscriber to the Spectator for many years. I heartily agree with what you have been saying lately about Mr. Lloyd George, but the illustration of a firm of solicitors taking a doubtful security and charging 7 per cent. (see Spectator, August 21st, p. 262) is, however, most unfortunate. Solicitors never knowingly take doubtful securities either for themselves or their clients as a matter of business. If, actuated by any other motive, they or their clients take a doubtful security, this does not justify any such rate of interest as 7 per cent. Five per cent. is the utmost limit. I have been actively concerned as a solicitor for about forty years past, and although I have had title-deeds relating to thousands of mortgaged properties under my notice, I caunot recall more than one case in which as much as 51 per cent, was charged, and in that case the mere fact of the interest exceed- ing 5 per cent. gave me an unpleasant shock, both as regards the solicitors and their client the mortgagee. The usual rate of interest is 4 per cent., although daring the last few years, owing to the general feeling of insecurity, the rate has risen in many cases to 4i per cent. No; you are altogether under a false idea. No solicitor can afford, either on behalf of himself or his client, to take more than 5 per cent. interest. The principal business of my firm is advancing money on moetgage, and I doubt whether the whole amount advanced at 5 per cent, would amount to 21,000, and the 21,000 would be made up of very small mortgages. A solicitor's experience is not limited to the transactions which pass through his own office only. Subsequent sales bring under his notice practically the bulk of the mortgage transactions that have been previously carried through in his district by his brother-solicitors. What I say, therefore, as to rate of interest applies not only to mortgages in my own office, but to all in this neighbour- hood. I have had a good many London mortgages pass through my bands, but even there I have not heard of mort- gages at a higher rate than 5 per cent. There may be dis- tricts in the North where business is very speculative, and the rate of interest on mortgages of houses and land is higher than 5 per cent., but I doubt it. I feel sure that in all country districts (your illustration was a country mortgage) the rate never exceeds 5 per cent ., and that if a solicitor were known to be mixed up with mortgages at a higher rate he would forfeit his professional character. If solicitors willing to negotiate 7 per cent, mortgages were common, that unfortu- nate man who felt the discovery that his cousin was a solicitor the cruelest blow of misfortune would have been justified.
[We regret the blunder in our illustration, and can assure our correspondent that the very last thing we desired was to seem to prejudice an honourable profession. Our point would have been quite as good had we named 5 per cent. as the rate of interest. All we desired to do was to point out that if it is not wrong for solicitors to exercise the rights of property, it cannot be wicked for landlords or land- lenders to do so P—En. Spectator.]
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