Home buying tips and Mortgage information

When it comes to buying property and applying for a bond, knowledge is power. Buying a home is a serious financial commitment, and certainly not one you should rush into blindly. Do your homework properly; speak to an authorised financial service provider such as your banker or broker, but also get to grips with home loan terminology by reading our bond terms glossary.

Property: to rent or to buy?
Knowing when to buy property depends very much on your personal circumstances. If you’re in a transitory part of your life like starting a new job, getting married or considering moving or emigrating it may not be the best time to be making big financial decisions.

Buying a property and repaying a bond  is no short-term commitment, and it’s generally a good idea only to buy once you’re fairly settled and financially secure. Yes, now is the best time to get into the property market, but certainly not if your income is going to be erratic for the next year, or if there is any reasonable chance that you’re going to be experiencing cash flow problems. Reduce your own financial risk exposure then only consider buying a property when you’re in a good position to do so.

Sure, renting from a landlord means paying off his or her asset, but it also limits your own financial commitments, and will ensure that your accommodation-related expenses remain constant for the duration of your lease agreement.

Know what you can afford
When it comes to buying a property, how much you can afford is influenced by a range of factors like your total income, total expenses, the nature of your income-generating activities as well the medium term economic prospects all play a role. Some property investors may argue that buying a bigger (more expensive) property will increase one’s potential return on investment, yet there are no guarantees that this strategy is fool-proof.

Even if you are able to get a “bigger” bond approved in accordance with the National Credit Act, unexpected interest rate increases could still increase your monthly bond premiums to the extent that you can’t keep up with the repayment schedule and then what? Not spending the maximum bond amount you can qualify for is not a bad idea inasmuch as it “builds in some fat” and protects you against economic factors beyond your control.

Buying a cheaper property thus means that you are not as vulnerable to interest rate hikes as you would be if you’d gone for the biggest bond possible.

When you’re using a bond calculator, be sure to take ALL your regular monthly expenses into account, and also allow for those unexpected expenses like medical and dental expenses, speeding fines, annual tuition fees, property related levies, birthday presents and holidays don’t pay themselves!

Buy property for now – and later!
Although you may wish to get into the property market as soon as possible, you would do well to consider what your property-related needs will be in five years’ time. Will you still be single and living on your own, or will you be living with someone else? Will you be starting a home business, or a family? Will your home’s locations still be suitable in terms of where you’ll work, and will the boho neighbourhood you enjoy so much be suitable for raising children in?

Buy the right property in the right location
When it comes to buying the right property, location is key and not only in terms of suiting your lifestyle requirements, but also to ensuring that your investment grows (“appreciates”) over time.

Prepare yourself for the long haul with a bond
Property is a not very liquid investment category. Be prepared that you will probably need to hold onto your home – and bond – for several years before you could sell it and make a profit. Given the cooling property market, chances are that you could end up making a loss on your home if you need to sell it after only a year! It is therefore critical that you’re in the right stage of your life, and that you truly can afford what you buy.

Choose your co-investors carefully
Buying with friends or family members can help you get into the property market earlier – yet it could also leave you stuck with having to foot their bond contribution if things go sour. Should you choose to co-invest in a property, it is probably a good idea to consider getting an “income protector” or similar type of bond cover or life assurance cover policy for all the parties investing in the property.

All the parties should also consider their own medium-term property needs like what if you and your mates all got hitched with live-in partners? Would everyone be happy with running your home as an adult commune? If not, will you all be able to formally agree to how the arrangement is to be managed?

Choose your bond type carefully
Choosing the right type of bond for you will again largely be influenced by your own circumstances, property-related needs and financial position. Be sure to discuss these at length with your bond originator or authorised financial services provider, and get as much bond information as you can. It’s one of the most crucial financial choices you’ll need to make, as it has long-term financial implications.

South African bond companies tend to offer a range of bond solutions ranging from interest rated linked home loans and fixed-rate bonds to variable-rate mortgages and second mortgages. Understanding the difference between these types of home loans is key, as it will enable you to choose the right type of home loan to suit your needs.

Always read the fine print
Applying for a bond tends to involve a fair amount of paperwork like always read carefully before you sign anything, and be sure to ask for more bond information if you’re not sure what a particular contractual clause means. Make sure that you know exactly what your contractual obligations are, and have your bond originators explain how different case scenarios would affect you financially.

Establish your fixed expenses and budget accordingly
Buying a house comes with a range of additional expenses. Property levies, property taxes, maintenance and bond cover all add up, so be sure to consider and list all your expenses (and potential expenses) before you apply for a bond and commit to buying a property.

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

A Bond Originator Works As A Mortgage Negotiator Between You And The Bank

Everyone dreams of buying a home and typically will save for a while in order to secure a down payment. Traditionally once you are ready to purchase your first home you will approach a financial institution for a mortgage. Then you would wait to hear if you have been approved for a mortgage. Things are not necessarily that easy anymore, banks are becoming more difficult to secure a loan from and there are many different banks offering various mortgages rates. The whole process can be confusing; this is why a Bond originator can be helpful.

Bond originators provide a service to you in applying for a mortgage. It is their job to assist you with the process of securing a home loan and get you the best possible rate. A Bond originator actually simplifies the process by acting as the liaison between you and the financial institutions.

Agencies that act as Bond originator’s work for you but get paid by the bank. Their services are free to you the applicant and you never pay them any money. The way they get paid is through the bank when a bond for a new home has been granted.

The originator works directly with you, the applicant, and handles all the leg work associated with securing a bond. These professionals deal with financial institutions on a regular basis. They are educated in all the options that may be available to you the loan applicant.

Since they deal with the banks on a regular basis they have the power of the negotiator and therefore provide you with leverage that you as an individual would not have. Consequently the banks are more willing to work with them since they represent more than just your mortgage. They basically have the advantage of being more than just a single person dealing with the bank.

This leverage can be utilized to provide you with a loan that has a better rate and perhaps shorter-term than you would have qualified had you not used their service. Utilizing an originator to secure your mortgage is a hassle free way of securing a loan and assuring yourself that the terms are the best possible. These professionals can evaluate your financial situation and determine what you may qualify for and what they feel they can pitch to the bank.

Bond originators are becoming the most popular method of applying for a loan for a new home. It is believed that this will eventually be the only way to apply for a mortgage. Under tough economic conditions banks become more and more selective and provide mortgages only to the absolute best applicants. This does not mean that a home loan is out of reach of the average person. But rather that the bank needs more evidence of your ability to pay. The bank originator will convince the bank that you are a viable candidate for a mortgage. If they don’t secure your mortgage they don’t get paid. These are the reasons why you should seriously consider using a Bond originator when you get ready to buy a new home.

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

Buying a home is one of the biggest investments a person will make in his or her lifetime. Because your home purchase is probably the most expensive one you will make, the homeloan itself is an important financial decision.

The prospect of owning a home is exciting, but it can also be a time of anxiety. This is a time when emotions must be kept in check, and one should make an informed financial decision. Our aim is to help you understand, from start to finish. From your first contact until your final approval of your loan, everyone at Mortgage Plus is dedicated to saving you money and getting you the loan you need. Fast and effective, without any sweat from your side.

By making the process a simple and uncomplicated as possible, AND BY SUBSIDISING SOME OF YOUR COSTS, we guarantee your total satisfaction.

When purchasing a property, there are normally two major costs involved, namely transfer and registration costs. This is where Mortgage Plus plays a major cost saving role to the buyer. We will give you a cash back bonus plus 30 % off the attorney conveyancing fee (when using our preferred attorney).

If you are thinking about a new purchase it helps to understand the options available to you which ultimately saves you money.

STEP 1: House hunting
STEP 2: Sign offer to purchase.
STEP 3: Seller accepts offer.
STEP 4: Contact MORTGAGE PLUS.
STEP 5: Financial Institution will confirm requirements.
STEP 6: Property Valuation done by bank.
STEP 7: Decision taken by bank.
STEP 8: Final approval. (Letter of Grant)
STEP 9: Registration attorney instructed to attend to the registration.
STEP 10: Customer to sign documents at 2 sets of attorneys.
STEP 11: Home loan registered in buyers name at Deeds Office.
STEP 12: First monthly instalment due within 30 days of registration date
STEP 14: Get your CASH BACK BONUS from Mortgage Plus.
STEP 13: Title deed & sent from attorney to Bank for safekeeping.

Let our extensive experience work for YOU.
Let us do all this for you FREE OF CHARGE!

Mortgage Plus : knows the business of mortgage bonds.

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