The news providers are at it again. They are announcing that the hot U.S. economy is about to hit us below the belt again. The U.S. FED is said to be getting prepared to raise the U.S. prime rate 1/2%. This latest increase will mark the seventh time this year they move to protect the low U.S. inflation rate. This jump of course will have a negative impact on our prime rate. An increase of 1/2% is eminent. This should allow lending institutions in this country to feel obliged to raise mortgage rates. Those of you with mortgage renewals coming due this year better start shopping now for replacement mortgaging. To give you the proper initiative, let me spell out why you want to do this. The average mortgage in the metropolitan Ottawa area is $140,000. The interest rate chosen today (10% for a one year term) would dictate that you will pay $1400 in interest over the next year (that's $140,000 times 10%). If you wait 'till summer and the economists are correct in their prediction that rates will be 12% by then, your mortgage would entail an increase in interest payable of $2800 (that's 2% more than today's rate times your $140,000 mortgage). Your present lender probably will not accommodate you with an early renewal without some kind of penalty. Convinced yet? Here's how you do it:

Those of you with time on your hands should clip out the list of mortgage lenders published each weekend in the Sun. Let your fingers do the walking, look up phone numbers and begin dialing to save money. You want to tell these lenders of your predicament, that being of your mortgage coming due, let's say in September/95, and that you are shopping for a replacement. You want to know:

1) Will they guarantee rate 'till your maturity date? A NO means you hang up and call the next number. A positive response...on the next question,

2) Will they accept an assignment of your mortgage? That means you won't have to pay for new appraisal fees or new legal fees to switch lenders. If they say NO, on to the next number. Once you are successful in getting positive responses to the first two questions, then you carry on with the following:

3) What is their guaranteed rate?

4) If rates go down, will they allow you the lower rate?

5) What are their prepayment privileges?

6) Do they charge any fees for this service?

Once you have chosen your next potential mortgage lender, set up an appointment to go in to sign an application. You will need to bring with you:

A) proofs of income by way of letters from your respective employers (pay stubs are no longer accepted),

B) your present insurance information,

C) the whole file you originally received from your lawyer when you bought the house,

D) the latest mortgage statement from your present lender indicating how much money you still owe on the house,

E) a picture of your residence.

You will be asked to order from your present lender a "discharge" statement so the new lender may payout the old lender at maturity. Once ordered, your present lender will contact you to ask why you

want a payout statement. Tell them that you had to change lenders in order to protect yourself against an unnecessary drain on your cashflow. If your present lender is now willing to match rate, ask them why they didn't offer when your started this exercise.

For those of you with little or no time on your hands, try the mortgage brokers in your area, for a small fee they will do the shopping for you. Don't procrastinate, one more increase is costing you money for nothing. Act now to stop the bleeding. Rate guarantees to the end of 1995 should be available.