The maximum interest rate on mortgage arrears will be 12.1%, compared with the current Bank of Israel interest rate of 4.1%.
The Bank of Israel interest rate is falling, but the Ministry of Finance interest rate on mortgage arrears is not. A Ministry of Finance Accountant General circular sent to the banks today states that the maximum interest rate on mortgage arrears will be 12.1% as of today, triple the current Bank of Israel interest rate of 4.1%.
The maximum interest rate on mortgage arrears is the average prime interest rate of Israel's top three banks, plus a 6.5% margin.
The interest rate on arrears for other loans was set at 12.1% today, amounting to 1.0083% a month.
The interest rate on arrears for late money transfers from the banking system was set at 10.1%, 2.46 times the Bank of Israel interest rate, amounting to 0.8417% a month.
The Accountant General interest rate was set at 5.6%, 37% above the Bank of Israel interest rate, amounting to 0.4667% a month.
Published by Globes [online] - www.globes.co.il - on April 1, 2004