In an effort to collect early payments on some of the 70,000 loans issued since its inception, the National Housing Trust (NHT) is offering mortgagors two incentives to pay off their outstanding balances quickly.

Effective October 1, mortgagors who pay off their outstanding balances during the last three months of this year will get a 10 per cent discount on the loan balances while those with loan arrears for 60 days or more, get a waiver or reduction of the 12.5 per cent debt management fee imposed on accounts in arrears - if they settle by year end.

Referring to the first condition as its Pay-Off Incentive Programme, the trust said mortgagors' balances will be discounted based on the speed at which they clear up their accounts, giving them a maximum discount of 11 per cent if they settle balances in October and a minimum of nine per cent if they settle in December.

In June 2006, NHT's impaired loans stood at $426 million but it is not clear how much money in loan value the NHT is hoping to collect between October and December from this initiative, or if the returns will have any significant impact on its impaired loan port folio.

"This type of functional cost information is not available at this time," said the trust in an earlier response to Sunday Business when the query was posed on what it was costing the trust to service performing and non-performing loans.

Sophia Lewis, communication coordinator at NHT, said the initiative was not an extension or a version of the amnesty offered earlier this year.

Instead, she said, the discounts fall under the NHT's 30th anniversary celebrations, implying the offers were more to be considered gifts.

Lewis said the trust would not be giving up or losing money by offering discounts to beneficiaries as early payments meant savings for NHT in servicing the loans.

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