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disclosure statement to resâ€" The change in byâ€"law setâ€" cind a deal. ting was made, in part, to . On the management side, reduce the problem of financial and operational reâ€" owner apathy. At present, a sponsibilities of corporaâ€" new byâ€"law needs a twoâ€" tions have been clarified thirds vote of all unit and the processes for setting â€" owners. Under the new bill, corporation byâ€"laws, rules a meeting would require a and regulations overhauled. â€" 50 per cent owner quorum, ‘"‘The new Act now obligaâ€" either present or by proxy, tes each corporation to with a byâ€"law change nee assess contributions to a ree ding a twoâ€"thirds meeting serve fund to pay for major â€" vote. ‘"The new Act now obligaâ€" tes each corporation to assess contributions to a reâ€" serve fund to pay for major repairs and replacement of common elements,"‘ exâ€" plained Mr. ‘Grossman. ‘"Every month unit owners will have to contribute to this fund." The following questions and answers are taken from an Ontario Ministry of Conâ€" sumer and Commercial Reâ€" lations brochure entitled "GETTING A MORTâ€" GAGE". A mortgage may be the best way to get the house you want or to raise urgently needed money. But handled unâ€" wisely, a mortgage can be a major source of finâ€" ancial difficulty for the average Canadian famiâ€" ly. You could even lose the house you have worked and saved for. To prevent this, you will need to ask questions and use caution. "What can go wrong?*" When things go wrong with a mortgage it is usually beâ€" cause the borrower does not fully understand what the total cost is or how much time he has to pay it back. Misunderstandings may be the fault of the borrower or the lender, but it is almost always the borrower who gets hurt. Let‘s look at some of the common misunderâ€" standings that can occur. "I can always get that advertised Low Interest Rate" Some lenders and mortgage brokers advertise low rates for mortgages. They may even promise you on the teâ€" lephone that you will be able to get your mortgage at these low rates. Very often, however, it turns out that "there is no more money at the lower rates‘‘ or that the special low rates are only available to people who have a solid financial position. You may believe you qualify for the low rate, but, when you go to conclude the tranâ€" saction, you may find out it will cost you much more. The extra cost may jeoparâ€" dize your plans. ‘Where can | get a Mortgage?" Mortgage funds are availaâ€" ble from banks, loan and trust corporations, insuranâ€" ce companies, credit unions, finance companies and priâ€" vate individuals. You can also arrange a loan through a registered mortgage broker who may lend his own funds or who may deal Condominium backgrounder Applying for a mortgage ‘"We felt the rule requiring twoâ€"thirds of all unit owners was too restricâ€" ting,""‘ Mr. Grossman exâ€" plained. "It was just too difâ€" ficult to get that many with any or all of the aboveâ€" mentioned. ‘"‘Instead of a Second Mortgage, why not a bigger First Mortgage?" Let‘s suppose you have $30,000 left to pay on your first mortgage which is at 9%. Let‘s also suppose ‘you need $5,000 and you are thinâ€" king of a second mortgage. The lender or broker may suggest that instead of having two payments â€" one for the first mortgage and one for the second â€" you should just have one payâ€" ment for a new, larger first mortgage. He might sugâ€" gest, for example, a new first mortgage of $35,000 at 10%% instead of your exisâ€" ting first mortgage of $30,000 at 9% and a standard second mortgage of $5,000 at around 14% . Stop and think. If you keep your 9 per cent mortgage and take the second mortâ€" gage, your total interest payments during the next year would be $3,400. If you take the new first mortgage, the interest will cost you $3.675 next year. So don‘t give up that lower interest first mortgage unless you are really going to get a betâ€" terâ€"deal. In the example given above, for instance, you might get a better deal by keeping that first mortâ€" gage and getting a second mortgage for $5,000 at 14 per »ent. In short, weigh all the economic advantages and disadvantages carefully beâ€" fore you refinance‘! ‘‘Can‘t | get a Second Mortgage that will cover my First Mortâ€" gage too?" Yes, you can. It‘s called an umbrella mortgage. This is where things can really get complicated and great cauâ€" tion is needed. Let‘s suppose you have a $30,000 house, and $20,000 to pay off on the first mortâ€" gage at 8 per cent. You need $5,000 and you have heard that you can get a hoâ€" meowner‘s loan on a second mortgage basis. The lender tells you that you can have the $5,000 second mortgage you want at 14 per cent but that you will need to make two payments â€" one for the first mortgage and one for the second. As an alternative, the lender may suggest that you can owners out and the manageâ€" ment function â€" bogged down." The new bill obliges the corporation to obtain and maintain adequate insuranâ€" ce coverage on the entire property, makes the apâ€" pointment of auditors manâ€" datory and spells out their duties. Dispute settlements will be mediated by hearing ofâ€" ficers drawn from local conâ€" dominium corporations, the condominium community in general and any other group interested in providingmanâ€" power. At present disputes turn the $20,000 first mortâ€" gage over to him and he will pay it off for you. In its place he will give you one large mortgage covering the total amount at, say 12 per cent. This is an umbrella mortgage. Taking the umbrella mortâ€" gage means you will then have a new mortgage for the combined amount of $25,000 at 12 per cent â€" this $25,000 being the amount of your first mortgage plus the $5,000 you wanted in the first place. The interest payments are now $3,000 for the next year rather than $1,600 and the effective rate of interest on the $5,000 you borrowed is 28 per cent. That kind of inâ€" terest rate is simply far too high. ‘‘Why not take out a Mortgage so 1 can conâ€" solidate my debts?" It depends upon what your debts are and how much inâ€" terest you are paying. Some advertisements may tell you to consolidate all your debts with a mortgage so that you are left with only one monthly payment smaller in total than the combined monthly payments you were paying before. Sometimes this is a good idea,. But it doesn‘t work every time. Let‘s think it through. Conâ€" solidating your debts with a mortgage can be cheaper only if the interest rate on the mortgage is lower than the interest on the other debts you want to consolidaâ€" te. But that‘s not all to watch for. Just because the interest rate or the size of the monthly payment is lower doesn‘t mean you will end up paying less. You may have a smaller monthly payâ€" ment or a slightly lower inâ€" terest rate but the repayâ€" ment may extend over a longer period of time, making the total interest charges more expensive in the long run. Or,. you may make smaller monthly payâ€" ments, but get left with a very large payment at the end of the mortgage. Don‘t juSt look on the surâ€" face. Figure out the total inâ€" terest on your present debts if you pay them off over a reasonable period of time and then compare that with the total interest you will pay on the mortgage, Insist upon getting this comâ€" parison straight before you make a decision on a mort‘ gage. We think this is sound advice. Indeed, this advice doesn‘t just apply to mortâ€" gage financing, it applies to all forms of consumer borâ€" rowing. ‘"‘!‘m buying a house, will I save money if | make® a larger cash downpayment? Isn‘t it easier to arrange a Seâ€" cond Mortgage with the present owner?" You may get the house cheaper if you are in a posiâ€" tion to pay all cash to the (‘ first mortgage. If, however, you haven‘t got sufficient cash to do that, you may need to arrange a second mortgage. If you do, it‘s eaâ€" sier and cheaper to arrange in your purchase agreement )‘ to give the seller a second â€" _ mortgage since he will proâ€" bably offer you better terms ._ _ of repayment and a lower _ rate of interest than you , could obtain if you were to ; arrange a second mortgage _ loan with someone other : than the seller. Bear in mind _ though, that if the seller _ agrees to accept a second ‘ _ mortgage from you as part ‘ of the purchase price, he f may insist upon a slightly ‘ higher price for the house _ than you might have otherâ€" wise paid. ; "‘If 1 pay off my Mortâ€" _ gage fast, will it cost me 1 _ less?" 1 Your mortgage may obligaâ€" _ te you to pay a bonus to the .__lender if you wish to make , mortgage payments more , _ often or in larger instalâ€" g ments than the Scheduled ; _ rate of repayment. Hoâ€" ; wever, you may find that , _ you still save money by _ paying off your mortâ€" __ gage.. especially if you are __ _ able to arrange a new mortâ€" gage with better terms to J A ; ; suit your financial ability. [' Remember too... The Canaâ€" f da Interest Act provides that even if you have a mortâ€" 6 gage for a longer period of _ time than 5 years, you are : nevertheless entitled to pay _ off the mortgage at any time after the first five ~_ _ years provided you pay the ~_ _ lender 3 months additional ‘ interest. are resolved through the courts, which can be costly and timeâ€"consuming. The board of directors of Condominium Ontario will draw half of its membership from the ranks of unit owners. The rest will be drawn from areas of the inâ€" dustry¢and from profesâ€" sional ranks. This is "conâ€" sistent with our governâ€" ment‘s philosophy _ of industry _ selfâ€"regulation," said Mr. Grossman. ‘‘And although the study group reâ€" commended the establishâ€" ment of a government reguâ€" The Registrar of Mortgage Brokers. The Ministry of Consumer and Commercial Relations, Queen‘s Park, ~â€"__ REAL ESTATE . _ >~~._ INFORMATION ~Waterioo Chronicle, Wegnesdsy, August 16, 1978 <~Page 27 'Citing the consumer minâ€" istry‘s commitment to less, not more, intervention into the marketplace as a prime reason, Mr. Grossman added: ‘"We felt also that a group directly involved in condominiums could better deal with the everyday difâ€" ficulties than some remote government _ organization. And the study group‘s hearings proved that this is already taking place effecâ€" tively through local and reâ€" gional owner associations.‘" Condominium Ontario will be a nonâ€"profit, provinciallyâ€" chartered corporation withâ€" out share capital. Its main functions will be : ~ â€" to operate an informal and speedy dispute solving mechanism ; â€" to provide direct advice and assistance to any corâ€" poration that requires it; . â€" to collect financial inforâ€" mation from all corporaâ€" tions to ensure sound fiscal management and pinpoint problem areas : â€" to provide an educational and information role for property managers and directors of condominium corporations; and â€" to answer inquiries from BLUEVALE TOWER . .. Having Ample Visitor Parking at _ lappiness Is 225 HARVARD PLACE, WATERLOO â€"Prices Start at $25,600 â€"Down Payments from 10% OPEN HOUSE 2:30 till 9:00 p.m. Daily 1â€"5 p.m. Weekends or call John Stephens or Dorothy Russell at 8B6â€"0151 owners, prospective purâ€" chasers and corporations. "*The corporation‘s role in education will be a major one,"‘ the consumer minisâ€" ter stressed. "Information officers will be able to proâ€" vide handsâ€"on assistance to condominium corporations, especially new ones, and will be available for guidanâ€" ce and expert assistance to the regional associations."" Activities would include preparing and arranging management courses and the preparation and disâ€" tribution of information sheets and publications. "Ultimately," Mr. Grossâ€" man added, "we should end up with a vastly improved information network using all the elements of the conâ€" dominium community. "This legislation,"" he conâ€" cluded, should play a major part in restoring confidence and credibility to the conâ€" cept of condominium living in this province. The study group proved that while conâ€" dominiums are a viable houâ€" sing apparatus, public conâ€" fidence is low and the inâ€" dustry in general lacked stability. â€" ‘‘The Condominium Act 1978 should restore that staâ€" bility." (Continued from page 26)