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Tips to remember on mortgage renewal THE ALTON HILLS HOMESTYLE Saturday Jane Page YEAR RESIDENTIAL MORTGAGE RATE High interest rates are having a dramatic impact on new home sales when mortgage rates go up people simply stop buying However when rates escalate people who already own homes may find mortgage renewal time a nightmare Families dont want to lose their homes and yet paying another few hundred dollars a month is difficult George Vice President and Genera Manager of DirecTrust Canadas first 24hour telephone trust service says There are a number of practical things you can consider when renewing your mor to help the pain of higher interest rates Pay down the principal If you nave some extra cash saved up Hopkinson recommends that you pay down as much of the principal as possible Lets say you had a two- year mortgage of ed over 25 years at 11 per cent Your monthly payment would have been If you are renewing at 25 per cent by paying down about you can maintain the same monthly payment 2 Buy down the interest rate Several financial institutions in eluding offer flexible mortgages where customers can pay a fee up front or add that fee to their principal to buy down the tgage rate to a more affordable level Investigate open mortgages Although during times of high rates it always seems that things will never change history proves that interest rates are cyclical in nature Hopkinson says would suggest that people look at an open mortgage that allows repayment at any time It would seem that a twoyear term would safely see you through the current high rates An open mor tgage gives you the to both pay down larger amounts when you can or to lock into lower rates when they fall 4 Shop Around Hopkinson advises consumers to shop around for good rates There often is a spread between the lowest mortgage rates and the industry average Find the company that of the best rates But do keep in mind that many companies charge transfer andor discharge fees Balance these feels off against the savings from the lower rate 5 Extend your amortization period One of the least painful ways to reduce cash flow problems is to ex tend the amortization period for your mortgage For example if you currently have a mortgage at 11 per cent amortized over years your monthly payment is If you renew the same mor tgage at 25 per cent your monthly payment jumps to However If you extend the amortization period to 30 years your payment becomes a more affordable Reevaluate your schedule of payments If you are paying off your mor tgage with bi weekly payments con Eider changing to semi monthly Payments will be lower but Hopkin son warns You will be adding to the amount you spend on interest over the life of your mortgage This option assists short term cash flow but will cost more In the long run As soon as rates go down you should move back lo the bi weekly payment method Refinance other debts with your mortgage No matter how high mortgage rates may seem interest rates on all other floating rate debts such as credit cards will be higher Hopkin son explains Most financial in will allow you to increase your mortgage to re finance other debts The legal costs involved will typically be more than offset the lower rates If a consumer owes on a credit card charging 75 per cent he will save in the first year by consolidating that debt with a mor at 14 per cent Even with legal costs of about the saving is still considerable Hopkinson adds It may even be worthwhile to refinance a fully paid for family home to consolidate other high in terest loans 1981 illinium 1985 Jan 1980 to Avg Rates Municipal bylaws block new housing concept TORONTO Two Montreal univer professors have unveiled a house that can be built for less than It sits on a plot of land 14 feet wide It cost including land in downtown Montreal would be less than The grow home as it is called looks better than many houses in which Canadians live and for which they pay more than It s call a grow home because its use is Maley Prominent UK company expands to North America Canada recently launched its prominent line of home building products in North America The company is a wholly owned sub sidiary of Building Services Limited a family owned diversified group of companies headquartered in Cheshire England Like its parent Canada activities are directed toward the sales marketing and distribution of a wide range of products to the new home construction and renovation in The parent company has been con ducting business the for three generations and has achieved a leadership position in the residen tial building market In the past few years has expanded its operations into Nor them Ireland Holland and Ger many The Company now employs more than people most recently cast its cor eyes toward North America where new home construction and older home renovations were boom Canadas busy building pro gram was identified as a major op portunity to offer the breadth of pro duct range and specialist technical expertise gained over the last decade in Europe The Company opened its North American of in Mississauga Ontario last year and is directing its overall operations from there One of the primary objectives of Canada is the introduction of its ventilation products Over the years the ventilation line has grown and expanded to include specialist roofing accessories and the only molded insulated attic hatch s attic hatches provide a high quality appearance and finish and incorporate insulation and vapour seals They are recognized as a major improvement over trad lional ill fitting hatches As a result they are increasingly specified major builders wishing to improve the home finishes offered to their clients Tailoring their products to specific markets Canada also developed an exclusive state of the art range roof ventilators designed to combat roof space con densation Their unique matching of the colour texture and profile of the roof system enables them to blend invisibly with the roof covering while at the same time providing the essential correct levels of ventila tion Willan s roof ventilators per form effectively with shingles slate clay steel and concrete roof tiles The Companv has alreadv established an extensive distribution network in Ontario and the Atlantic Provinces and is now in the process of marketing its products throughout Canada and the United States Sold under the and Ghdevale brand names the pro ducts are appealing both to building contractors and doit vourselfers Thev ore available through local building dealers RECYCLING Il only if all do pare Please Remember to Recycle This Newspaper flexible and a balconv or extra room can be added at little cost Professors and Avi Friedman of the School of Architecture then- house can be built for a square foot That compares with an average cost of a square foot for lional houses Too good to be true The president of the Canadian Home Builders Association sas builders could sell more than half a million of the houses But municipal bylaws make them impossible to build The sad is that this house as wonderful as it is could not be built todav Metro Toronto of ancouver cities where there is a need for affordable housing Gordon Thompson Existing homeowners do not want cheap housing in their neighborhood Clearlv this is in m back Mr Thompson The implication is that it will be difficult if not impossi to change law to create housing CHEAP TO Never mind Toronto Montreal and Vancouver Inexpensive houses would be welcome elsewhere countrv if will permit them 1 What is not so Cana outside of the three big cities have to settle for such modest hous A breakdown of costs prepared by the professors shows how the grow homes compare with conventional housing The land cost saving is important for urban locations But the low construction costs will appeal to suburban and rural residents as well The study is based on land costs in Montreal in The first figure cited here is for a tvpical home the second for a grow home Construction costs 000 development cost S3 land cost marketing cost 000 500 Total com for a home 132 grow home The house is small but attractive It a twostore building with l 000 square feet of living French doors open to a balcony on the second floor The main floor has a kitchen bathroom and living area The second floor is open concept but can be divided to create a second bedroom It no palace but it better than a high rise apartment Presumably a basement could be added The best thing about this house is that it would be built bv the private sector without government subsidies Privatelv people close to govern ment Ottawa is worried that Canadians will be divided into two classes those who have houses and those who do not This is a recipe for social unrest politicians fear The interests of the two classes will be Whether the grow home is the solution to such an overwhelming social problem remains to be seen Clearly density must be Increased in the big cities It is not so clear why people who live elsewhere in the