Mortgage Plus Bond Originators – Buying A Home

So, you’re in the market for a new home. It’s an exciting step and there is nothing like a brand new space to call your own. Before your search begins, Mortgage Plus Bond Originators would like to ensure that your journey to home ownership is a smooth one.

Here are some guidelines to help you every step of the way.

Step One: Know what you want

• Do some house hunting homework first!
• Know what size suits your needs and consider your choice of area. Think about accessibility to work, public transport, schooling and other amenities.Remember location really matters!

Step Two: Do your sums

Know exactly how much you can afford. It is not just the installment you will be paying – you need to include insurance (homeowners, household and life) and municipal costs in your budget. Use our Monthly Repayment Calculator to see how much you will need on a monthly basis, to cover the bond. After that, you need to add the additional costs to this figure.

Step Three: Banking on a budget

Now is the time to approach a Mortgage Plus Bond Originator consultant. You can give us a call on 0861 1111 93 or go online  at www.mortgagepluscc.co.za to do an affordability assessment to find out exactly how much credit you can access for your new home.

Step Four: Putting down a deposit

You may need to put some of your own money on the table before you can buy a house. Depending on your financial situation, some of our home loan products allow you to qualify for larger home loans without paying a deposit.

Step Five: The Right Package

Mortgage Plus offers a wide range of financial products to meet your individual requirements. It is important to choose a Home Loan package that works for you!

Step Six: Plan for additional costs

Be aware of other once-off costs that you will have to pay, over and above the deposit. These include initiation and administration fees, legal costs, bond registration fees and VAT/Transfer Duty.

Step Seven: Begin the search

There are a number of factors to consider when determining the initial amount to offer on a home:

• Sale price of similar houses in the neighbourhood for the past year or so will give you a good estimate of current market value. The estate agent will assist you with this information.
• View our Property Sites for advice.
• Mood of the market and the neighbourhood. In a seller’s market, the houses sell fast and sellers get close to the asking price. In a slow market situation, or where the house has been in the market for a while, or when the seller needs to sell quickly, the responsibility to negotiate for a good price after the initial offer has been made lies in the buyer’s hands.
• The general condition of the house is also an important pricing factor. Information concerning things that need to be done in or around the building must be taken into consideration when making a price offer.

Step Eight: Know what you are buying

View as many properties as possible. Make comparisons. Make a short list. Sleep over the short list. Do not guess or assume anything. Ask the seller or estate agent as many questions as you can until you are totally satisfied. Viewing the selected property several times will assist in final decision-making. It is your responsibility to ensure that a prospective home will not require excessive future maintenance. You are allowed to question the reason for selling and the number of other sales taking place in the area.

Step Nine: I like it! I want it!

The decision has been made! It’s now time to think about signing an offer to purchase with the seller and to complete your home loans application. Ask for assistance on 0861 1111 93, or apply online at www.mortgagepluscc.co.za .

Make sure you have the following documents on hand:

• Proof of income
• Copy of your South African ID or passport
• Copy of offer to purchase
• Proof of current residential address (municipal account, Telkom account or valid TV licence).
• Salary earners: most recent salary slip or banking statement for the last 3 months, a letter from your employer which will be followed by a telephone confirmation to your employer.

Once Mortgage Plus Bond Originators has received all the relevant documentation, the approval process begins. The bank will need to do a valuation of the property being purchased to ensure that it is of value and that the bank is willing to finance it. The home loan approval process can only be efficient if all the correct documents are provided. The estate agent will assist you in completing an Offer to Purchase. This makes the offer formal. It includes an offer price, closing date and financing information.

Step Ten: Tracking your Home Loan

• Once approved, Mortgage Plus will instruct the bond attorney to begin registering the bond.
• The seller will advise the Transferring Attorney to transfer the property. Title deeds and cancellation figures are requested from the bank currently holding the bond. A rate clearance is requested from the local authorities/municipality.
• The Bond Attorney contacts the transferring attorney and advises the amount available for guarantees. They then request the draft transfer deed and guarantee requirements.
• The cancellation attorney is requested to cancel the seller’s bond on receipt of a guarantee for the outstanding amount.
• Once the transfer attorney has received the title deed and cancellation figures, the buyer and the seller sign the transfer documents. The buyer pays the transfers costs to the Transferring Attorney.
• The Bond Attorney prepares the bond documents and the buyer signs these documents and pays the cost.
• The Bond Attorney lodges the documents at the deeds office.
• The deeds office receives the documentation and checks it before being registered.

This process can take about three months from the date of approval.

Step Eleven: Signing on the dotted line

• Before a Home Loan is granted, your financial position and credit record will be checked. The bank will pay out the loan on the day of registration.
• Once the legal documents are signed, the transfer fees paid and the seller of the property paid, the deed is done. You can congratulate yourself because you are now a proud owner of your new home!

Step Twelve: Living up to your responsibilities

Make your bond payments on time. It is vital that you do not miss a single monthly repayment, as the interest owing on the loan will increase and you’ll end up paying more than necessary. Debit orders are a good way of preventing late payments. If you have trouble making payments, inform the bank as soon as possible.

Step Thirteen: Save thousand on your Home Loan

By boosting your monthly instalments, you can make huge savings on interest and pay off your Home Loan in double-quick time.

Step Fourteen: The big move!

Moving into your new home is an exciting experience, but it can also be overwhelming. Here are some tips to help you settle in faster.

• Change address with all relevant parties and specific authorities. You can get a ‘Change of Address’ form from the Post Office to make the necessary changes.
• Remember to sort out your utilities (water and lights) connections.
• Locate your nearest emergency services: closest hospital, local police station, etc and record their numbers.
• It’s a good idea to meet your neighbours and find out about any initiatives in the area to combat crime, etc.
• In case of an emergency, make sure you know where to find the main shutoff valve for water, the fuse box, and any other important switches.
• HOC and insurance cover will be in place from date of transfer or occupation.
• Always plan a budget for other expenses like maintenance and repair, service costs such as security alarm, gardening services and any other home emergencies
• Every building has a life cycle, which means your home will require major repairs at some point. Repairs must be expected and planned for. Set aside an emergency fund to deal with unexpected problems ranging from major repairs to illness and job loss.
• Live within your budget. Prepare a monthly budget and stick to it. You should monitor your spending every month and evaluate your progress in meeting your financial goals.

Please contact us if you require any further information or would like to apply for finance:

Complete this short form online

011.327.4489 / 0861 1111 93

morne@mortgagepluscc.co.za

www.mortgagepluscc.co.za

Personal loans are not the only solution to securing funding for housing alterations or high-ticket items like weddings, motor vehicles and school fees. Bonds, as well as the latent value in your home derived from capital appreciation since the property was acquired, offer a cheaper alternative.

Before deciding the financial goals, you need to access your financial position and plan accurately for managing the debt repayments particularly in the current economic climate where the banks have assumed a harder line in risk assessment.

In the fourth quarter of last year South African banks tightened their credit lending criteria that now place restrictions on accessing capital in home loan accounts. This is in line with the National Credit Act that governs consumers’ credit facility to prevent over-indebtedness.

However, that does not detract from the reality that the bond – whether it is an existing bond or the registration of a second bond over a property – remains one of the cheapest vehicles through which to borrow money.

The amendments have seen the banks freeze clients’ access to draw down additional cash from their home loans in a bid to manage their risk. This means particularly high-risk clients have to apply to access funds including repaid capital and equity that has been accumulated over the years.

The application includes an affordability assessment to gauge individual client’s ability to repay the loan after the funds have been withdrawn.

Having passed that hurdle and qualified to access the capital, the bond offers the opportunity for renovating your home, consolidating debt or paying off high-ticket items like motor vehicles, holidays, school fees or a wedding.

The benefit is that accessing the existing bond or securing a further loan over the property that takes advantage of appreciation since the initial purchase date provides the opportunity to repay debt at the prevailing prime rate. In some cases, Mortgage Plus may secure mortgages at a discount to prime, further reducing the costs of capital.

Essentially the bond has worked as a savings mechanism for additional capital that although does not earn interest, effectively saves future interest generated over the bond. By reducing the terms of payment (to say 15 years rather than 20), you have negated interest payments over a five-year period and the benefit of that saving is not taxable.

However, even the bond option comes with the opportunity to think out of the box. Essentially paying cash for an item – even large-ticket ones – is the best means for limiting debt traps and by using the bond as a savings account until the full purchase price has been achieved, you scoop a double bonus by avoiding debt and benefiting in the short-term by having additional capital in the bond to lower the interest payments.

Consolidating assets may be another alternative to personal loans. In brutally analysing assets around the house – two motor vehicles when one may be sufficient or leisure craft that have spent more time in the garage than on the water – the bulk of the required expenditure may be within reach without stress.

Mortgage Plus ranks among the country’s largest mortgage originators and, via a national sales and branch network, can offer free advice to home owners and buyers.

A relatively young business locally, bond origination is the process of finding mortgages for home owners that suit their specific needs. The key lies in giving the client a choice of banks and thus providing a hassle-free service without incurring additional costs.

Essentially, each bank has its own lending criteria and product range to different market segments – from first-time buyers to the private bank client with the multi-million-rand property. Also, Mortgage Plus sells home related finance products which add value such as life cover on a bond, home owners’ comprehensive insurance and bridging finance to cover the time gap between buying one property and selling another.

By choosing Mortgage Plus for a loan, you will get that continual service to make sure you are getting the best deal possible.

CONTACT US

Speak to a home loan consultant about financing your new property or reviewing your existing mortgage. We are able to assist in lowering your bond repayments and securing attorney discounts.

Complete this short form online
Call us on 011.327.4489
Email: morne@mortgagepluscc.co.za

www.mortgagepluscc.co.za