Before you sign read above the iine ONE of the most dumb- founding and astonishing findings I have discovered is that people who are normal- ly inielligent and shrewd make incredibly naive deci- sions. One such choice is the conscious deci- sion to not read and fully understand the contracts they sign. It is absolutely mind boggling that normaily intelligent people will sign, for example, a mortgage document — a docu- ment wherein they are assuming probably the largest financial liability of their life — and they do not read it cover to cover. Recently I asked an audience of more than 200 people, “how many of you have a mortgage on your home?” Probably 90% of the audi- ence raised their hands. I then asked “how many of you have actually read your mortgage document?” Not one hand was raised — not one! People who have the ability to read, and choose not to review and comprehend significant financial documents are — well, just plain foolish. Why dowe not.read these docu- ments? Why do we not ask questions about words, terms or phrascs we may not understand? Why do we accept the’ statement that these are “just standard” contracts? Standard to whom? I don’t sign mortgage -documents, Contracts of. - Purchase and Sale, Management and Rental contracts every day. These contracts are not “stan- dard” to me. They are standard to the people offering the contract and are thus written in their best inter- ests. For me to not bother to’ read “their” document and then ask clari- fying questions — no matter how elementary those questions might - appear — is just being foolhardy. Some: months ago, a client asked me to review a “rental pool” contract she was about to sign. In my perusal of this document, I found buried in the back pages, the following item: “In consideration of the Manager Paying sums provided tor by this agreement (replacement or repair of capital items such as a stove or fridge) each of the Pooled Unit Owners hereby mortgages, charges and encumbers in favor of the Manager, all of its right, title and inter- est in and to cach pooled unit and the Revenue — derived therefrom to secure the due and puncru- al payment of all deficits and the interest. accruing thereon attributed as herein before provided to that Pooled Unit.” Whar did this mean? In this con- tract, the management company offered, as a part of their fce-for-ser- vices rendered, to repair or replace any capital item such as appliances to ensure the agreements with the ten- ant were being honored. Obviously a - good service and of course you, as the owner, are expected to repay the manager for this expense as soon as possible. So far, no problem. However, this clause means that to ensure that you do pay any amounts spent on your behalf you must, before any such funds are even payable, assign all rental income to the Manager, p/us you must literally gave the title of your property (which you have just paid $110,000. to acquire) over to the property management company. This is like using a hydrogen lines ‘bomb to kill a fly. Absolutely ridicu- igus! No one in their right mind would mn that document, right? Thousands, yes thousands ef nor- ‘mally intelligent and sane investors have donc just that! I suggested to my client to cross out that clause -of the contract. She did su and the contract was accepted by the management company with- _ Out a quibble. Let's examine a second example. Tn reviewing a morte : contract for another client, I COeoeecececeseseosencesss clause that stated. “should the required monthly payment under this mortgage be in default sor a iod longer than 24 hours the Mortgagee has the right to charge a penalty of one month's interes based upon the current outstanding balance.” What did this cla se mean? if my client s monthly mortgage payment in arrears — for whatever reason — my client must pay a penalty that in his case amount- ed to over $800. Whea bringing this clause to the attention of the lender, he voluntarily changed the 24 hours to thirty days. How many people have a clause like this in their mort- Friday, August 7, 1998 — North Shore News — 47 gage — thousands upon choasands! How mes; people have had to pay a penalty nix just a dav or two I would guess thousands. Th is a horrendous Pr to pay for not reading and questioning a contract. I could give you dozens of other exaniples but Pra sure you have got the point by now, Obtain and read any contract before you sign it. Hf you do not understand a word or clause in a contract have it rewritten in a form you do understand and ensure it forms 3 part of the contract. If you want to change a “standard” con- tract, do so! seeeoeeeecveetsaeanene oeoese Making investments of any sort has enough associated risks in itself withour us undermining ourselves. Always be cognizant that it_ is your responsibility to look after yourself. Read and understand the entire contract before you sign on the dort- ted line. Remember, the rule of the mar- ketplace is “Buyer Beware.” lc is your responsibility to be “Buyer Aware!” — Michael Dowty is vice-prest- dent, special projects of Century 21 Prudential Estates Ltd. and is a long-zime West Vancouver resident. Call bim at 925-6453. Home on the ridge LOWER Lonsdale isn’t the only North Shore community to see.a rise in con min f tion. Deer Ridge, at the foot of Cypress Bow! in West Vancouver, is an excellent: example of apart meant dwelling at its finest, complete with swezping ocean views. A anes . COC OT COTO OCDE ETOH EEE USEaEeDeLeEeES ADDRESS: 8437 Citrus Wynd, West Van. Ae eewereevae Heer sreenenecsveseraceeenesesee LOT SIZE: 73 X 172 X 85 X 131 INTERIOR SIZE: 3362 SO. FT. Pacer eee e seer ese Sees OOSOEneeesneeseeuessens NUMBER OF BEDROOMS: 4 Peer rere ere neenoeeseeusereessenssceseessenn NUMBER OF FLGORS: 2 Coomera ew eee seeseDee eee eeeeenoeeseseeeeses ASKING PRICE: $649,000 OPEN § HOUSE: Sunday 2 - 49m LISTING AGENTS: Lionel & Clayton Lorence 926-6718 (off.) 644-3700 (cell) 926-5505 (home) SPECIAL FEATURE: design with fabulous view eweeccceseooccrecones utstanding west coast Holiday mare = Outstanding west coast sizzling design with a fabulous custom built home style for an entertaining flare. Skylights, vaulted ceilings. Family room with a large heatilater stone wood burning fireplace vented to the living room. Spacious entrance hall. Huge master with incredible ensuite. Large marine finished staircase rails, marine lounge and wet bar with fre doors to iarge sun-soaked decks. Courtyard decks with waterfalls onto garden pond of natural rock. Wired for music and alarm. Extensive tock terraced landscaping & professiotial manicured gardens. Location is private by the purchaser. with fantastic ocean, mountain views & amazing sunsets. A perfect easy care lifestyle comparable to Sahalee, West Point & Edenshaw. All measurements are approximate and should be verified Clayton Lorance, Macdonald Realty (Lionel Lorence) Lid.