30 = Sunday, August 24, 1986 - North Shore News Business MORTGAGE TIPS Buying a home makes smart financial sense IF YOU'RE paying rent, all you are doing is putting money into somebody else’s pocket. Why not put that money in your own pocket by purchasing a home? Almost every financial advisor will tell you that one of the first investments you should consider (after building up your savings ac- count, purchasing insurance, and buying such basic investment vehi- cles as term deposits) is a residen- tial property. monthly payments, the amount of interest you will save can add up to thousands of dollars. Try for an ‘‘open’’ mortgage that gives you the option of either increasing your monthly payments, or of making extra, Jump sum payments. Then make these pay- ments as early as possible. In the beginning years of your mortgage, the vast majority of your monthly payment is going to towards interest. Paying off part of the principal (the balance ow- money matters by Lisa Smedman Although you will be paying a large chunk of interest during the lifetime of your mortgage, you will at least be building up some equity in the property. And, thanks to in- flation, most properties in a well- chosen location are bound to in- crease in value. . Canadian tax Jaws favor those who purchase a_ self-occupied home, known as “principal resi- dence."’ Although you can’t write off the interest you pay on your mortgage, as those in the U.S. can, any capital gain (the profit, or dif- gerence between what you bought and sold the house for) is tax free. When iooking for a mortgage to buy a home, follow a few basic rules. a Get the shortest amortization period your budget will allow. Although this will mean higher 66 Export” “Export A” “Vantage” ing) can dramatically increase the ratio of principal paid off with each payment. (Just totalling up all the pay- ments you will make on the home will show you that you will ultimately be paying several times the listed price of the property in interest). Shop around for the best interest rate available. Then decide if you want a ‘‘fixed”’ er a ‘‘floating’’ in- terest rate. if it looks like interest rates are unusually low, and all indications are that they will rise, lock yourself into a fixed rate for as long as possible. If, however, interest rates are high but seem ready to fall, look for a shorter term, or go with a floating (variable) rate. While the amortization period of SMOK NT ek laa a PONTE ” " WAANING: Heallh & Welfare Canada advises that danger to neaith § your mortgage is typically set at anywhere from five to 25 years, you may have to renew that mor- tgage several times. You will only be able to attain a certain interest rate for a ‘‘term’? of anywhere from six months to seven years, after which your mortgage must be renewed. Look for a new development in mortgages — the weckly or biweekly payment plan. The more often you make payments on a mortgage, the quicker the principal goes down, and the less interest you wind up paying. “Real estate is still one of the best investments you can make over the long run,’’ says John Wettle, a realtor with the Sutton group. During his nine years in the business, Wettle has seen real estate prices skyrocket during 1981, wher the price of some pro- perties seemed to be doubling overnight. He calls 1981 the ‘‘last really good year’’ for reai estate sales. But by August 1981, interest rates had ciimbed as high as 22 per cent. That was when Wettle saw many investors lose their shirts. ‘‘When the interest rate went to 22 per cent the markets died, anda lot of investors went broke,"’ says Wettle. ‘‘The number of investors in real estate dropped very sizeably. People just stopped buy- ing.’’ “Confidence is slowly coming back,’’ says Wettle. ‘‘With interest rates dropping, people are coming back into the market."’ Wettle says that real estate prices “bottomed out’? between the summer and winter of 1985. This spring, prices started to climb again. ‘‘In fact,’’ says Wettle, “‘if you bought well last summer, chances are your investment will have appreciated by as much as 10 per cent already. “ExportA’’, “Expoit’ and *“Vanlage”' in Regular or King size. 20's of 25's. Price Effective (While Quantities Last) Til August 30, 1986. indreases with amount smoked—avaid inhaling. SURREY Guildford Mall National Bank head will speak Monday INTERNATIONAL FINANCIAL centres, will be the topic when Michel Belanger, chairman of the board and chief executive officer, National Bank of Canada ad- dresses The Canadian Club of Vancouver on Monday, August 25. A native of Levis, Quebec, Belange: served both federal and provincial governments early in his career. There will be a no host reception at 11:45 a.m., followed by lunch at f Shoppers Drug Mart § Correction g RE: August circular vol.19 #16 ff f The Maxi Unshine Make-Up § B was advertised in error. The ¥ & product should have been Max ff Factor Endiess Shine Nail y Enamel. For $1.39. } H We apologize for any inconve-: § B nience this error may have | f caused our customers. 12:15 p.m. with the speaker scheduled for 1 p.m. The event will be held at the Pacific Ballroom in the Hotel Vancouver. BALDING? Stop Hair Loss — Rejuvenate Growth Roms Han Cline requires one hundred bold or balding subjerts to commence a cinnal inal. an come! ante with Section C eto eight, sero zero five of the Food and Drug Regulations. tu tett the guaranteed hair growth promotor, Raddudio The subjects chosen will receive treatments of G mensmal cost and must odbere ship to the Healment protocol A dermatalegst will be present fo monslor the ptoredure FIRST COME — FIRST SERVED ©) 1755 West Broadway Vancouver B.C. V63 455 736-7710 We’re way overstocked with new 1986 Hon- da 4-door Accords and we must make room for the 87’s. Come in this week and make your best deal. No reasonable offer will be combo es refused. Open Monday - Saturday 9:00 am - 5 pm ‘ a 725 Marine Drive North Vancouver 984-0331