PAGE 22, WEDNESDAY, OCTOBER 14, 198 1, WHITBY FREE PRESS deals, the name of the game is to build equity in the property as quîckly as possible, and the higher your down payment, the better invesiment you wîll DOULAR $fISE make. Alan Guan le with Deloauce Ha8kins & Selle, Chartered Accountants, Toronto. Homebuyers should plan for extra cash needed By David A. Hughes, CA Plan for eno-ugh money to safely buy that home By Alan C. Guann, CA Young couples saving for their rirst home usuaiiy set themselves a goal -- an amount they think they wilt xeed for a down payment on a mortgage. This may be 510,000, $15,000, or more. How much does the average young couple need to save before they can move into an average home -probably their first? The answer depends on a number of factors. First, white the amount of down payment is important, it is not as important as their abiliity to make monthly Dollar Sense offers general financial advice"by members of The Institute of Chartered Accountants of Ontario. mortgage payments after they move into the home. One affects the other, of course, but the latter is more important. Don't be tempted to buy a more expensive home than you can afford, just because you have a large dlown payment and a mortgage is avail- able. The general rule is that you shouId not assume morigage and other regular homeowning costs -- taxes, utilities and maintenance - in excess of 30 to 35 per cent of your net, after.tax income. You may treat this rule fiexibly up to a point, but you shouid accept that beyoýnd that level of costs, you wili have to make addi- tional sacrifices in your life- style. 103 DUNDAS ST. W.. WHITBY 668-5868 WHITBY - PRIME RESIDENTIAL AREA - Lovely ranch-style bungalow on 1/3 acre Lot. Spaclous foyer, fireplace ln large living room. Kitchen has large eat-in area, bulît-in stove andi oven and ac- cess to covered patio and secluded garden with mature trees. Plaster construction throughout. Full price $105,000. Vendor will assist in f inanc- ing. CalAline Currior, 668-5868, Res. 668-2284. WHITBY $81,500 - $16,500 down payment buys this 2-storey older home.. Completely renovated, featuring 4 bedrooms, separate dining room, finished recreation room. A lot of charmn and character to this home on a well landscaped lot with large brick patio and lovely garden. Mortgage runs until 1986. CalAline Currier, 668-5868, Res. 668-2284. BROOKLIN, ONTARIO - Located ln one of the' most prestigious areas of trie hamlet of Brooklin, this one owner, one and one-haîf storey, 8 roomn beautiful brick home, surrounded by mature trees on a professionally landscaped 173' x 266' corner lot must be seen to be fully appreciated. This home features a formai dining room, extra large living room, 3 fireplaces and much more. There is also the possibility of future lot separations. For further Information please caîl Jack Fudge 668- 5868, Res. 668-3077. CUSTOM BUILT - RAISED BUNGALOW - This 5 bedroom Jack Jacobsen home is situated on 1/3 acre. 2 brick fireplaces, separate dining room, sliding patio doors open unto a cedar deck. Trie view is one of a kind but you are only 5 minutes to 401. Asking $120,000. Immediate possession. Cali Tonlight - Don't Hesitate. Rose Relph, 668- 5868, Res. 668-1567. 11 % MORTGAG E - Just $59,900. wili1 buy you a 3 bedroom, 4 year old tastefully decorated home on a 146'deep Lot. Large eat-in kitchen, master bed- roomn with 2 alcoves. Situated on a quiet court, this gem has a$41,900 mortgage at 11 % tilt1 1983. Cali Rose Relph, 668-5868, Res. 668-1567. SOUTH PICKERING - $64,900. Parklike setting overlooking and with access to Frenchmans Bay, within walking distance of Go station and shop- ping centre. Delightful 2-storey, 4 bedroom condo townhouse featuring 3 bathrooms, finished rec. room with bar, large cheery kitchen with customn cupboards. $26,000 lst mortgage at 111/4%. Cali Chartes Rycrof t 688-588, Res. 668-2484. KING STREET - Attractive ranch bungalow with attached garage in central area of Whitby on a quiet residential street ined with mature trees. A super Lot 81' x 136,. A must to see at $89,900.00. Cati Chares Rycrof t 668-58M8, Ras. 66&.2484. The way to start is to calculate one-third of your monthly take-homne pay. Now subtract from it an amount for annual taxes utilities and maintenance. The remainder is whgt you cèan safely make in monthly, blended mortgage pay- ments. Then, using a set of mortgage amortization tables (available from bookstores, libraries or most mortgage companies), find out what amount of principal, at what interest rate and over what termn matches your ability to pay. Let's take a quick exampte. The house costs $70,000. The couple earns $2,750 per month after tax. One-third is $920. Subtract say $225 for taxes, utilities and maintenance. The remaining $695 wiil cover a S55,000 mortgage over 25 years at 151/2 per cent. The safe down payment, if you can find the right house and the right mortgage at the right interest, is at least $15,000. Remember, however, this is a rock.bottom minimum. And remember, too, that the down payment is not the only cash you wil need in order to move into a house. There are legai fees, moving expenses, installa- tion charges, furnishings, and other costs .- many of which your lawyer can explain. Also, in ail reai estate Young couples saving for their home should know that they need more cash than just the minimum down payment .. in fact, quite a lot more. The varlous costs of finding a mortgage, closing the deal, acquiring owner- ship of the property and moving in can run as high as $?,000 for even a modest home. And most of these payments must be made, in cash, on the closing date or the deal will fait through, The first major expense is legai fees. These normally amount to about Dollar Sense offers generai financiai advice by members of The Institute of Chartered Accountants of Ontario. between 1/2 and 1 per -cent of the price of the home. On a fairly typicai, 580,000 home the tegal fees wilt likely be around $60. Various dishursements, filin g costs, etc., laid out by the lawyer wilt add at least $50. The next serious expense is the Ontario Land Transfer Tax, which is paid by the buyer. The rates are $4 per $1,000 of thée first $45,00of the price, and $8 per $1,000 for the re- mainder. Inspection and appraisal fees witl run to at least $135. Then,. if no survey exists for the property, the buyer wilt have to pay about $250 to have the property surveyed. These are ail unavoidable costs and they must be WANTED HOMgS IN WHITBY & BROOKLIN FOR IROSPEÈCTIVE PURCHASERS. REAL ESTATE FEE 31/2% CALL 6680515 ASTON BRUMLEY REAL ESTATE LTD. Our Accumulation Annuity offers competitive rates for convenient periods A floating interest rate or a guaran- teed interest rate for one year, three years, or five years - it's your option with our Accumulation Annuity. And because there is no front-end load or policy fee, ail your money goes to work for you immediately. Caîl for the current rates of interest on our Accumulation Annuity. Nothing else grows quite like it. HERB TRAN 7?5-6564 Oshawa .,<-.-, 668-5968 Whitby Mutual Lfe of Canada paid, in cash, on the closing date. For our unsurveyed $80,000 property the total is $1,500-.and this is tikely on the low end of the possible range. In addition, if the house is oit.heated, the tank will be fitled on the closing date and the buyer must pay for a fuit tank of oit. A typical tank may hold 300 to 500 gallons, with oit at about $1 per gallon. So the cash costs before closîng can be as high as $1,800 - $2,000. Now consider the costs of insurance, moving and making the new home liveabte. If you need to buy appliances -- a refrigerator, stove, washer and dryer -- these alonte can add a further $2,000. And don't forget the charges for having tetephones and cable tetevision installed and having electricity and gas meters read. Buying a home of your own is undoubtedly the best investment you can make, but you shoutd be aware that you need more cash than just the minimum down pament. Your real estate agent, lawyer or mortgage broker should explain ait the extra costs to you before you buy. If they don't ask. There is nothing more disappointing thân tosing the home -- or being forced into an unexpected emergency bank boan -- for the sake of an extra few thousand dollars. David Hughes is with Kirk Roe & Company, Chartered Accountants', Mississauga. Thanks to you it works... FOR ALL 0F US. United Way EICKOW PRINTINGI APPOINTMENTI ARTHUR SUGARMAN Mr. L.J. (Joe> Dlckson, presîdent of Dlckson Printing and Office Supplies, ls pleased to announce the Bp. poîntment of Mr. Ar- thur Sugarman to the sales staf f of trie Durham Reglon f lrm. Mr. Sugarman ha.s a broad background of business experience and wIli be utillzing thîs experlence Im- medlately ln advertls- lng sales.