Home Loan / Mortgage Bond Applications in South Africa

Congratulations! Your decision to purchase your own home will no doubt prove to be one of the best decisions you have ever made. There is no better investment than buying property, especially when you compare it to paying rent, and the feeling of pride that comes with ownership is unsurpassed.

Now that you've made your decision, it is very important to arm yourself with an in-depth understanding of how the whole procedure works and what the costs will be. This is quite possibly one of the largest financial commitments you will ever make, so be sure you are fully prepared.

The Best Advice You Can Get
Bonus Bonds will work together with you to give you the best advice possible on every aspect of your new home purchase, and most importantly, on financing it. Banks often differ greatly in their approach to home mortgage lending. Your Bonus Bonds consultant will explain the different features of various types of home loans in South Africa and which is best suited to your own requirements. You will understand the different terms and conditions, interest rates, fees, and charges.

Consolidating Your Finances
The best advice we can give you is to consolidate your debt. The days of having many types of outstanding debt are long gone. Today, it is far more economical to put everything together with your home loan mortgage, as home loan interest rates are considerably lower than the interest rates for credit cards, personal loans, overdrafts, and the like.

Minimize your Mortgage
It is not only possible to greatly reduce your mortgage, interest payments, and the time it takes to pay off your home loan, it's also recommended. By strategically structuring your finances, you can significantly reduce your total home loan debt. How?

- Arrange it so that part of your salary goes directly to paying off your home loan, and make additional repayments when you can, like when you get a bonus from work, for example.
- Stick to a manageable monthly budget and avoid unnecessary debt.

For example, you can settle your home loan in as little as 5 years by:
- paying off an extra 1.2% of the original capital debt every month (R1 200 per R100 000)
- taking advantage of fluctuating interest rates
- not accessing funds you have already paid off

This may mean you need to make some sacrifices now, but you will reap the benefits later in the form of a huge savings in interest. Talk to a Bonus Bonds consultant today, to calculate just how much you can save, and how quickly you can pay off your home mortgage loan.

First Time Buyers Home Loan
If you are a first time home buyer, you can take advantage of a special home loan offered by most financial institutions. This type of home loan allows you to borrow in excess of 100% of the total property value, which allows you to incorporate costs like transfer fees and bond registration fees directly into your home loan. There is usually no deposit required for this type of home loan, which allows you to enter the property market mush more easily.

To qualify for a First Time Buyers Home Loan, the following criteria are required:
- you must be a first time home buyer
- you must have a clean credit record
- loan amounts can only be between R100,000 and R1,500,000
- your joint or single income must be a minimum of R6,000 per month
- your monthly bond repayments cannot be greater 25% of your gross monthly income
- you must have a record of a minimum of two years in permanent full time employment

Before You Apply For A Home Loan
The best way to expedite the process of applying for a home loan mortgage is to be prepared, and ensure you have all the required documentation. Although many banks vary on what is needed, the following is a list of the most common requirements:

For all South African home loan applications, you will need:
- a copy of the offer to purchase, which contains both the seller's and the purchaser's details
- proof of income, including pay stubs and bank statements. If you happen to be self-employed, you will need documentation from your accountant outlining your income history, or a statement of your liabilities and assets.
- a copy of a utility bill or a statement from another institution which confirms your current address
- a copy of your official identification documents

Companies and close corporations will require the following:
- names, ID’s and contact details of all the directors/members
- a copy of financial statements, signed by the auditor.
- Articles of Association and Memorandum
- founding statement of the close corporation
- a resolution by the directors/members which gives the authority to sign the home loan application
- company/close corporation certificate

Trust companies also require:
- a resolution which gives an individual authority to sign the home loan mortgage application
- a copy of the trust deed

Contact Bonus Bonds today, and one of our helpful consultants will be happy to answer any questions you have regarding the purchase of your first home.

Home Loan / Mortgage Bond Applications in South Africa - Bonus Bonds

Bonus Bonds Products - Home Loan Applications