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Know what they mean by mortgage renewal Most homeowners have to renew their mortgage once the term expires. Mortgage contracts usually expire in less time than it takes to pay off the loan in regular monthly instalments. Terms are usually between two and five years. Some homeowners con- fuse the term with the amortization period which is the time it will take to pay off the loan. The majority of new mortgages have a 25 year amortization period. Once the term expires, the unpaid principal is due for repayment. Prior to the renewal date, your lender will send a note advising you of the date your present term expires. While legally there is no obligation to renew mor- tgages, lenders are normal- ly prepared to offer a renewal based on market conditions. The length of term and interest rate may not necessarily be the same. Just as the lender is not obliged to renew your mor- tgage, you are not obliged to keep your mortgage with the same lender. If you decide to find a new lender, you will be required to dishcarge the existing mor- tgage and register the new one which is usually arrang- ed by a lawyer. Often a new lender will accept the existing mor- tgage contract changing on- ly the interest rate. This is called a mortgage assign- _ment (transfer). In most repayment schedules, only a portion of your monthly payments reduce the principal, the rest pays off the interest. Usually at the time of renewal the amortization period is reduced by the years paid in the previous term. There are a number of factors that will affect what type of mortgage you choose. You will have to consider whether interest rates are remaining steady, going up or down. You will have to evaluate the hous- ing market to see if prices are going up or down. And you will have to consider how much money you can save. To reduce future interest costs, choose an open mor- tgage with prepayment privileges. An open mor- tgage allows borrowers to make partial payments dur- ing the term of the contract to reduce the outstanding principal loan amount. However, there is usually a penalty, often equivalent to three month's interest. You should check the amount of this penalty against the possible future savings on interest costs. Generally, you have to pay a higher in- terest rate with an open mortgage. A closed mortgage does not offer the opportunity for - prepayment, but it does provide the lender with a lower interest rate. With a fixed interest rate, over the length of 5 years, you will have the security of know- ing you wouldn't be facing an increase in the near future. The disadvantage of a closed mortgage is that if interest rates drop the lender will not alter the contract. The longer the amortiza- tion period, the smaller your monthly payments will be. However, the total amount of interest you pay increases substantially over a longer amortization period, especially if the in- terest rate is high. Choosing a longer term is favourable if you think in- terest rates will suddenly increase. On the other hand, a shorter term is best if you believe rates will drop soon. A variable rate mortgage (VRM) is a method of ar- ranging mortgage financ- ing whereby the interest rate may go up or down with the market rate. The interest rate of VRM is established by your lender according to an agreed for- (Turn to page 7) LOOKING FOR A NEW HOME? No need to look an further than the REAL ESTATE PAGES of this newspaper. Whether ifs a new home, cottage, fam, bullding lot or Investment property, you'll find It in the PORT PERRY STAR REAL ESTATE SECTION OPEN HOUSE -- SATURDAY, DECEMBER 2nd -- 1 to 4 PM DIRECTIONS: Port Perry east on Hwy. 7A to Nestleton, and follow signs. BRICK BUNGALOW east of Port Perry, 3 plus 1 bedrooms, overlooking Lake Scugog, features upgraded carpet, rec room with airtight stove, mature trees, well landscaped. Just listed at $159,900. Call Ernie or Penny Duncan 985-7386 or 986-0055. OPEN HOUSE -- SUNDAY, DECEMBER 3rd -- 1 to 3 PM DIRECTIONS: Durham 2 (or Simcoe Street) north of Port Perry to Woods of Manilla, follow signs. Your hostess: Debra-Ann Taylor UNIQUE BACKSPLIT Brand new quality built 2700 sq.ft., 3 walkouts, oak kitchen, main floor laundry, family room with brick fireplace, skylight, large entrance foyer with split stair- - case, plus much, much more. All on a 1 acre wooded lot north of Port Perry for only $269,900. Call Debra-Ann Taylor 985-7386 or 985-8881. BELIEVE IT OR NOT! The truth is we have a brand new three bedroom Viceroy house on a 1/2 acre lot for just $174,900. This home features country setting, water access, brick fireplace, plus more. Call today for your viewing appointment with Ernie or Penny Duncan 985-7386 or 986-0055. PORT PERRY Ideal family home. 3 bedroom, 2 storey, master bedroom with 4 pc. ensuite and walk-in closet. Main floor laun- dry, family room with fireplace, walkouts to deck, custom designed greenhouse kitchen, combined living room and din- ing room, partially finished basement ready for your touches, double attached garage. $219,900. Call Ann Elliott 985-7386 or 985-8123. : PORT PERRY Clean 1Y: storey, 3 bedroom, eat-in kitchen, finished entrance porch with closet, unfinished loft, detached insulated, wired garage. Walking distance to all amenities. $169,900. Call Steven Brouwer 985-7386 or 986-0687. Sle his] Aoi al-RWe Ncl3 hg S-R NIRS] {Sa N=] F.-Y de] | RA PORT PERRY REALTOR TORONTO LINE 686-3931 Sarving Durham Region = BO 1M2 SCUGOG STREET PORT PERRY 2985-7386 . 985-3398 . 985-8123 . 985-2526 . 986-4986 . 986-4303 . 985-3298 . 986-0380 . 986-0055 Bonnie Steele Ann Elliott Valerie Hoffman John Wolters C. Malcolm Bliss Christine Vanderniet Ernie Duncan Penny Duncan . 432-7087 . 985-8881 . 985-9652 . 985-2014 985-9415 986-0687 . 985-3110 Debra-Ann Taylor Sandi Kenny Susan Bryant Tom Schell Steven Brouwer .. Mark Smith $132,900. SCUGOG ISLAND Early possession, 2 bedroom starter home, family size living room, airtight stove, main floor laundry, private lot 95 x 185' irregular. Siding and attached garage to be completed. Call Valerie Hoffman 985-7386 or 985-2526. IN TOWN CONVENIENCE Walk to downtown or stroll along the lakeshore. 3 bedroom backsplit, cathedral ceilings over kit- chen and living room, eat-in kitchen, family room w/o to fenc- ed yard, fireplace, in-law apt. potential for mom. A must to see inside. Only $217,900. Call Mark Smith 985-7386 or 985-3110. pg BALL POINT Under construction, 3 bedroom raised bungalow, 2 car garage. Fireplace in living room, cathedral ceiling, 2 walkouts to decks. Choose your colours. Lot 115 x 261". Area of good homes, $184,000. Call C. Malcolm Bliss 985-7386 or 985-3298. SEAGRAVE Just listed, 1 acre building lot in area of fine homes. Listed at $125,000. Call Sandi Kenny 985-7386 or 985-9652. . 986-0055 SEAGRAVE -- $235,000. Neutral decor in this 3 bedroom bungalow, sunken family room, 2 - 4 pc. bathrooms, separate dining room, walkout to deck from kitchen. This won't last. Call Christine Vanderniet 985-7386 or 986-0380. BLACKSTOCK -- $229,500. Professionally decorated 4 bedroom backsplit with features for the entire family. Close to schools, backs onto open fields. Call for an appointment, _ John Wolters 985-7386 or 986-4303. Fan VIR HILLSIDE CHALET 4 bedrooms, walkouts from master' bedroom and living room overlooking Lake Scugog, woodstove, 12 baths, lake access. Asking $184,900. Call Tom Schell 985-7386 or 985-9415. ' IN TOWN -- $227,000. 3 bedroom brick and angelstone bungalow, fireplace, central vac, 12 x 32' pressure treated deck, walking distance to amenities. Call Bonnie Steele 985-7386 or 985-3398. ONLY $15,900. DOWN Canal front starter, 2 bedrooms, eat- in kitchen, living room, 3 pc. bath in area of permanent homes. Detached garage. Well maintained. Asking $124,900. Call Ann Elliott 985-7386 or 985-8123. SASSY SIDESPLIT, ROBINGLADE ESTATES Maintenance free exterior, 3 bedrooms, eat-in kitchen plus separate dining, walkout to 16 x 20" deck, family room with fireplace, 1: car garage on well groomed corner lot featuring postcard view of Trent Water System. At $209,900. you'll want to stay. Call Debra-Ann Taylor 985-7386 or 985-8881. Ape anton oe EN a