The benefits of using a Bond Originator

Bond origination is a relatively new concept in South Africa. It has only been introduced to South Africa about eleven years ago. Bond originators are there to make the application for a home lone process a lot easier, faster and more convenient. In this article we will look at a few benefits that you will get by using a bond originator.

You will see that bond originators will make the application process a lot more convenient for you. In the older days, before the existence of bond originators, for you to apply for a home loan, you would have to physically go visit all the different banks or non-bank lenders, in office hours, to see which one will offer you the best terms and rates. What makes it so convenient is that you can contact a bond originator and ask them to come see you by your own premises. Some of the bond originators can even come see you after office hours. And you only must go through the application process once, regardless of the number of banks and non-bank lenders. They will consult with all of them to get you the best offer.

Another benefit is that bond originators is connected to all the major banks and non-bank lenders in South Africa, ensuring you that you will get offer that will suite your personal circumstances the best, ensuring that you will receive the best terms and rates.

By using a bond originator will ensure that you receive the best possible rates. They will negotiate on behalf of the customer to the banks and non-bank lenders. Bond originators can save you between 0.5% and 0.25% on your home bond costs. That can save you thousands.

By using a bond originator can also save you a lot of time. In some cases, the bond originator will finish an approval process in half the time which the banks or the non-bank lenders can finish the process.

Insurance can also be very expensive in today’s world; thus, can a bond originator save you a lot of money with insurance. Due to the National Credit Act, banks are not allowed anymore to offer home insurance to their clients. The bond originators will then consult with all the different insurance companies to seek out the one that will give you the best fees, terms and conditions that will suit your circumstances.

Also, a very big benefit is that the bond originator won’t charge you a cent for their services. They will get their fees from the banks or non-bank lenders by themselves, saving you more money.

We can conclude and say that by using a bond originator is very beneficial to you and will save you a lot of time and precious money. It makes the home bond application process a lot more less irritating and confusing.

No Agent is a registered bond originator and offers home loans via Standard Bank, FNB, ABSA, Nedbank, Investec and Mercantile Bank.

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Homework Advice For First Time Home Buyers

It is clear that the decisions which a home buyer makes can have a major impact on your financial status in the future. It is important that property buyers don’t feel under pressure whilst making their decisions, but should rather take their time to make sure that they don’t regret any decisions in the future. It is important to do some homework before making any drastic choices. In this article I will give some advice on what a property buyer should consider before making the purchase and applying for a home loan.

Professionals in the real estate trade has said that by buying property is a major investment in one’s life, therefore it is important to make sure that you have your facts right regarding the buying process. It is important to know that you should not only base your decisions on feeling alone, although the home buying process can be a very exciting time of your life. There are many factors that you should consider before making the purchase. Next I will give a few tips on how to obtain the correct information to make sure that you won’t regret anything that you might have done.

The first thing that you should do is to assess your finances and your affordability level. The first and most important thing to do is to make sure that you will be able to afford the property which you want to buy. By consulting with a bond originator will help you to see for what home loan you can apply for and how much you will be able to afford. While these figures aren’t guaranteed, they will surely give you an idea of in what price range to shop for. By getting pre-qualification will also show the sellers that you are serious on buying. In the current market we see very few people who qualify for a 100% bond, there for will the pre-qualification also help you to see what deposit you will be looking at. There are also some other factors which should be considered. You should know that there are many other expenses which you will have to pay upfront. Thing like, transfer duties, home insurance, taxes and rates.

It is also very important to obtain as much info as possible on the property. The more information you can obtain, the better your end results will be. We all know the popular saying which says that knowledge is power. The more a buyer knows about the current market and the area of the house, the better prices you will be able to negotiate. It is also important to know how long the property has been in the market for. That should give you an idea of how lenient the sellers will be with the negotiations. A professional estate agent will be able to give lots of valuable market related info on properties in a chosen area.

Another thing that one should do is to check out the chosen neighbourhood. If you have decided upon the area which you want to buy property in, one should first look at a few other factors before signing any papers. The factor which has the biggest impact on the value of property is where the house is situated. One should look at factors like, traffic in the area, crime stats, condition of the infra structure and the quality of the schools. These thins will have a big influence on the value of the property. This information can be easily obtained by the local municipality and the local police station.

Another important factor is to make sure that the property is in a good state. People can make use of a professional home inspector to see whether the house is in a liveable state. Although that there might be small things which can be fixed, damage to the structure of the house can become very expensive to repair, making it not worth buying.

We should remember that knowledge is power, and armed with a lot of information can and will help you to make the right decision. The only way that you will ever be happy with property is if you do your homework well.

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Tell The Truth When Applying For a Home Loan

It is of utmost importance to tell the absolute truth about your financial status when applying for a home loan. Even if you don’t qualify for the full bond, you can then always try to make a deal with the seller to settle the outstanding amount. In this article I will explain why it is very important, especially if you are a first time home buyer, to be very open and transparent about your financial status towards a mortgage broker.

If you choose to make a deal with the seller, then the worst that can happen is that the banks can reduce the loan, or in extreme cases they can cancel the bond because they can see that you are busy going beyond your affordability limits.

Another important factor to bare in mind is, if you make a deal with the seller then it might be classified as fraud, and not everybody is aware of this. So make sure to inform your banks if you are busy with a deal as such. This is very popular in the lower end of the market, where people expect to get a 100% loan on the bond but fails.

People are now fully aware of the terms and conditions of the NCA (National Credit Act) but still don’t know that people should inform the banks of any major changes in the applicant’s financial status between the time period of applying for the bond and the registration of the bond. You are obliged to inform the banks if you are unemployed or if you are sitting with a big financial let down. It is important to inform the banks, so that they can re-evaluate your bond to see if they can lower the premiums or to see if you are still capable of paying the bond.

The NCA states that all lenders should do a good investigation on all loan applicants, to make sure that the applicant can afford the bond. This is also to provide the applicant and the seller with some form of security. The NCA is very strict on reckless lending by credit providers.

We have seen that some sellers have to sometimes put their properties up for sale for the fourth time before a qualified home buyer is found. This causing concern for sellers and that is why sellers should work with real estate agents to make sure that they get a qualified home buyer for their property.

People should understand that there is a difference between pre-approved and pre-qualified people, even with the help of a mortgage originator. Pre-qualification is where a lender gives the applicant an estimate of what they can afford. And this is calculated with just a little bit of personal info. They don’t even pull a credit report to give you a pre-qualification. The reason for this is that buyers can get an idea of in what price range they should be looking at.

Where as to get pre-approval, you need to provide the lenders with detailed documentation that includes bank statements, tax return slips and salary slip, just to mention a few.

We can thus see that it is very important to provide the lenders and the banks with the correct information. So that they can make sure that you don’t make a mistake by signing with something of these amounts of money, and to make sure that you can afford to buy the property and get the much needed home loan.

When you are ready to proceed with a home loan application , No Agent offers a mortgage origination service and shops around for the best interest rate from all the major banks in South Africa.

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How to get Pre-Approval for a Home Loan in South Africa

How to get Pre-Approval for a Home Loan in South Africa

Getting a pre-approval on a home loan can considerable speed up the process of buying a home in South Africa. You will also be taken a lot more seriously if you can show that you can afford the house that you intend to buy. This articles gives a short overview of the process involved in obtaining a pre-approved home loan in South Africa.

Mortgage originators can help you select the best home lender and can obtain a pre-approved home loan on your behalf. Mortgage originators have online facilities where you can complete your home loan application in the comfort of your own home. Find out more about applying for a home loan online.

For the pre-approval process to be completed some essential information will be required. The home loan lender will require three to six months payslips or bank statements as proof of income and a income and expenditure report. This information will enable the home loan lender to determine your ability to pay the monthly bond installments.

A credit check will also be done to obtain information on the amount of credit inquiries and credit accounts you have behind your name and to check on your blacklist-status. The pre-approval home loan will be based on your credit scores and your ability to pay the monthly installments. A clear credit record and a high income with low debt will place the purchaser in a position to negotiate a good interest rate.

Although pre-approval does not guarantee a home loan, it will serve as an indication for the seller that the applicant in all probability will qualify for the required financing.

Click here to read more about pre-approved home loans

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Expsenses to Consider When Buying a Home in South Africa

Expsenses to Consider When Buying a Home in South Africa

When buying a home in South Africa their is other expenses over and above your home loan that you need to consider. Make sure you budget for these expenses before you decide how much you can afford on your home loan in South Africa.

Home Loan Installments – You have to settle your bond payments and allow for an increase in your monthly installments on your home loan at any time.

Deposit – You might be required to give a 10% deposit on the purchase price. A deposit will also assist you in getting your home loan approved for the amount you applied for and may even help you negotiate a better interest rate on your home loan.

Insurances -You may be required to take out some sort of insurance to protect your mortgage in case of death and you need these installments in mind when you look at your budget. For full title houses, you will also be required to take out home owners’ insurance on the structure.

Transfer Fees – All attorneys follow a recommended tariff by various Law Societies with the effect that one attorney is not more expensive than another.

Levies, Rates and Taxes – If you have bought a sectional title, you will also pay levies from now on, which may also be increased should the trustees feel the need to do so. In case of full title, you will pay rates and taxes together with your utility charges.

Postages and Petties – An attorney may also charge you for sundries like postage and telephone calls. This fee is usually in the vicinity of R350.00 plus VAT.

Water and Electricity – Home buyers should also keep in mind that they need to pay a deposit for water and electricity either to the local council or the body corporate, and of course the monthly charges from there on.

Transfer Duty – This is a major expense and is a form of tax payable to the Receiver of Revenue before lodgment of your transaction in the Deeds Office. If you do not have that kind of cash available you will have to borrow it under your home loan which will result in extra interest charged.

Bond Costs – The conveyancer will charge you a recommended fee as set out in by recommended tariffs by the various Law Societies.

Extra Charges – There are also some extra charges such as a Deeds Office enquiry fee (About R65), a fee for FICA attendance (R150) and a fee payable to the Deeds Office on date of registration of your transaction (up to R500).

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Advice on Choosing a Home Loan in South Africa

Advice on Choosing a Home Loan in South Africa

In South Africa the home buyer is confronted with a variety of different home loan options. This article is aimed at helping you choose the best home loan package from the options available in South Africa.

Before you start take time to become familiar with the home loan industry in South Africa by doing some research on the internet and finding out about the different options available. You can then make appointments with a few banks or mortgage originators to find out more specific details regarding their home loan products. To get professional advice and have someone shop around on your behalf for the best deals. They will then give you a list with the different offers available and you can decide on your first and second option.

If you decide to do all the work yourself you will have to look at all the different quotations from the different home loan institutions that you have gathered. The different options available can be viewed on the internet and in some cases you can ask for an online quotation or you can go directly to the different banks for a personalized home loan quotation. After you have your different quotations choose the two options that suit you the best with the second option as a fall-back if the first option does not materialize.

Choosing the best interest rate option for your home loan is very important and can make a big difference on the overall amount you end up paying on your bond. Interest is the additional fee that you pay when repaying the loan and can therefore differ from bank to bank. The higher the interest rate is, the more your loan will cost you in the long run so try to negotiate the lowest rate possible on your home loan. In order to get the best interest rate, it’s important to shop around and compare loan rates and terms before deciding on a particular home loan. Request home loan quotes from a variety of banks and finance companies, as well as online lenders.Your credit rating and the collateral that you use can also have a effect on the interest rate that you are charged on your home loan so make sure to give all the necessary information.

Home loans in South Africa can either be “fixed rate” or “variable rate” loans. A fixed rate means the interest rate charged is fixed for a specific time i.e. two years or more. This option is best when the interest rates are low or to make budgeting easier. A Variable Rate is better when the interest rates are higher, because they can go down if the interest rates go down. However this rate will also go up when the interest rates goes up.

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Using a Mortgage Originator to Help You Get a Home Loan

Using a Mortgage Originator to Help You Get a Home Loan

A morgage originator deals on your behalf with the banks in South Africa to secure your home loan and get the best deal for you. You get professional advice regarding your home loan and the mortgage originator is able to deal with a variety of banks in South Africa in order to get you the best interest rate and home loan package. Using a mortgage originator does not cost you anything as they receive their commission directly from the bank involved. The banks can afford to pay this commission as they save on staff salaries when they use mortgage originators.

Using a mortgage originator to secure your home loan definetely has some advantages to it. The mortgage originator’s advice tend to be more objective than what you would receive from a bank. If you go to the bank directly you will receive advice that is usually biased towards their own products and services. Mortgage originators also work with various banks in South Africa to ensure competitiveness which usually results in a better deal on your home loan.

Mortgage originators send hundreds of applications to the banks in South Africa each month. This places the mortgage originator in a better position to negotiate a lower interest rate on your home loan and a small difference in interest can make a large difference to the overall amount on your home loan.

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Questions Answered About Home Loans in South Africa

Questions Answered About Home Loans in South Africa

Is bond registration costs included in a home loan?
You have to make prior arrangements with the bank if you want the bond costs included in the home loan. If you have not done this you will be required to pay the bond costs seperately and in full before the bond can be registered.

is it better to apply directly for a home loan or should I use a mortgage origanator?
Consider using a mortgage originator as they usually have contact with a large variety of banks which will compete for your business resulting in you getting the best deal on your home loan interest rate.

Do I need life assurance before I can get a home loan?
This will be required if ceding the life policy for the value of the home loan is a condition for granting the home loan. You are not obliged to use the bank’s insurance company but you can use another insurance company or cede an existing policy of your own.

What happens to the title deed after its registered?
The bank holds your title as collateral for as long as the home loan is operative and the title deed will only be returned to you once the home loan is fully paid.

How long does it take for the property to be registered?
Depending on the transferring attorney the registration process will take about four weeks. If it is an additional home loan on a property you already own registration should take no longer than two weeks.

Is it necessary to read through all the home loan documents?
You can rely on the bank’s attorney to guide you through all the home loan documentation but you will need to acquaint yourself with the content of the documentation because, as far as the law is concerened, ignorance is no excuse.

When will my first home loan instalment be deducted?
The first payment on your home loan usually will be deducted on the first day of the month following the month of registration. When signing your bond documents the bank’s attorney should be able to tell you when the first payment will be debited from your account.

What is a cover clause?
The bank will add an extra amount of cover to their costs, usually about 20% of the capital amount of the home loan. This amount protects the bank against other creditors if you should default on your payments.

Do I have to use a debit order to pay the monthly instalments on my home loan?
The banks will most likely include the signing of a debit order as a condition of the home loan as the bank will then be sure that they will be paid each month. The bank will usually allow you to choose the day of the month that you want the payments to be deducted from your account.

How is the bond attorney selected?
The major banks all have a panel of attorneys in each town from which they randomly select an attorney to register the bond. Usually the banks transferring attorneys will also be used for bond registrations.

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Applying For a Home Loan in South Africa

Applying For a Home Loan in South Africa

In the past if you wanted a home loan you had to go to your bank and make an appointment to see a staff member of the bank’s home loan department. You would then be given a home loan application to take home to complete and return with all the required documentation. Once the paperwork were received by the bank you had to patiently wait for the outcome of your application. Today the whole process of applying for a home loan is made much easier with mortgage originators who will send the documents to the various banks and negotiate the best deals on your behalf. In fact the whole home loan application process can be carried out without you having to leave the comfort of your home.

Your mortgage originator will be able to tell you of all the options that the various banks can offer you. Because the home loan application form must be completed very accurately the mortgage originator will help you with the technical information required such as the details of the property you are purchasing. They will let you know if your home loan has been granted and the bank will then send out a building inspector to value the property.

When you apply for a home loan in South Africa their are a variety of documentation that is required to back up your apllication. You will need to include a copy of the front page of your identity document and if you are married a copy of your marriage certificate as well as Antenuptial Contract. If you are divorced, the bank will require a copy of the divorce order. Applicants that are not South African citizens will need to provide proof that they are entitled to purchase property in South Africa. If you choose not to use the bank’s personal life assurance facilities, you need to provide proof of the alternative policies you have. The bank needs this to ensure that the home loan will be settled in full if you should pass away while the bond is still outstanding.

If you want a home loan registered in the name of a Close Corporation or Family Trust the banks will require some additional documentation. You will have to include a copy of your registered Founding Statement (for a CC) or Letter of Authority (for a Trust). If you have to sign as surety for your CC or Trust, or if some other suretyship is required, the surety document will be drawn by the bank’s conveyancer who will get you to sign it with your bond documents. If you work for a Government Department or company from which the bank requires collateral security, you will have to personally arrange this yourself.

After your home loan application has been approved the necessary bond documents need to be registered. You will meet with the attorneys where all the required documentation will be signed. You will be required to sign a Power of Attorney with the bond document attached, a Debit Order to secure your monthly repayments (a mandatory requirement by most banks these days), authority to pay forms which will authorize the bank to disburse the amount of the loan, the bank’s standard mortgage loan agreement, any specific conditions of the home loan it may have as well as any other required documents such as insurance applications and suretyships.

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Home Loans - Calculating How Much You Can Afford

Home Loans – Calculating How Much You Can Afford

How much should you take a home loan for? Generally the banks will give you a home loan around 20 times of your monthly gross income but should you take the full amount that you are entitled to? Here are a few points to consider before deciding on the amount of your home loan.

Before deciding on the amount for your home loan look at the possibility that your monthly income may fluctuate in the future. It is unlikely that your salary will decrease but you might be placed in an unfortunate position where you are retrenched and have to take a new job with a possible lower starting salary. If you are self-employed or work on a commission basis you may go through periods where your income may be substantially less than usual and this should be kept in mind when deciding on the amount of your home loan.

Unless you have a home loan that has a fixed interest rate for a certain period, your home loan may be subject to future interest rate increases. The vast majority of bond foreclosures occur during times when interest rates are high and monthly installments become unmanageable. Consider taking a lesser amount on your home loan than what you can currently afford to cover for possible future interest rate increases.

Your expenses may also be much more in the future. Account for future expenses such as school fees and university education for your children, repairs to your home and vehicles as well as increases in levies or rates. All these points make a good argument for taking out your home loan for an amount less than you can currently afford and thereby covering for future fluctuations in your financial standing.

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