How can we help you – Property Finance – Mortgages?

Buying a home is admin-intensive and we will make sure you know exactly what documents are required for your new home loan or first time buyer loan and when to make the deal happen for you.

What assessment factors do the banks look at?

Affordability, credit worthiness, and property value come into play when we assess your application.

1. Affordability
At this stage, the bank will undertake a comprehensive assessment to determine if the loan you apply for is affordable to you. Your credit history will be put under the spotlight and details of your current credit facilities will be sourced from a credit bureau. This way we can independently verify the instalment amounts for credit cards, vehicle repayments, cellphone contracts and other facilities in your name. It’s a step that has your best interests at heart. We do what we can to ensure you only take on debt you can afford. Never be untruthful about your income or expenditure as it can lead to your application being rejected.

2. Credit worthiness
A good credit history counts in your favour when applying for your home loan. Credit bureaus do not only list defaults or judgments against you but also keep record of good conduct on your accounts. If your conduct shows you to be a good risk client, you may be offered a preferential interest rate. This can save you a substantial amount of money over the life of your home loan. Your application could be rejected if you are considered a high risk client based on your credit history.

3. Property valuation
It is the norm for the bank to conduct a valuation on the home you intend to purchase. This is to make sure the property offers sufficient security for the loan you request and is of the type the bank normally finances. The bank may require you to pay a deposit on certain properties.

On approval of your home loan application, we will contact you to discuss the most favourable rate received from the banks as well as other important details and the terms of the loan. At this stage, I will advise your estate agent that the purchase of the property has been concluded and I will forward the necessary documentation to the attorneys to proceed with the registration of your bond and transfer of the property into your name.  The attorneys will contact you to set up an appointment for the signing of these documents.

If you would like to speak to a Professional Mortgage Specialist about your lending requirements, please phone Mortgage Plus Bond Originators on:

Complete this short form online

011.327.4489 / 0861 1111 93

morne@mortgagepluscc.co.za

www.mortgagepluscc.co.za

Work on your credit score
Your credit history is one of the first things that the lending institutions look at when they review your home loan application. It clearly outlines a person’s financial and credit performances in the past which holds a serious weighting as to whether or not you qualify for a loan, the amount you qualify for and the interest rate you stand to pay.
You are entitled to apply for a credit report on yourself every year from the government credit bureau, free of charge. You should carefully analyse your report before applying for your home loan so that you can take steps to improve it wherever you can. Be on the lookout for incorrect records and if there are any mistakes, write to the credit bureau in question, explaining what needs to be changed and why. Remember to send your requests through with all the necessary supporting documentation wherever necessary.

Calculate affordability
Credit providers have to perform an affordability assessment before granting credit. This process takes into account all your financial obligations, such as home loans, vehicle finance, overdrafts, credit cards, secured loans, and domestic expenditure, which are compared to the value of your assets and income in order to calculate your current financial standing. You should do your own assessment by using one of the many affordability calculators on the Mortgage Plus website. Here, you can input all your current monthly payments, debts and other expenses in order to calculate what size home loan you can afford. This is a very good exercise, as it will show you what you could possibly cut back on in order to qualify for a higher loan.
However, you need to remember that the mortgage repayment is not the only thing you need to factor in with regards to affordability. Owning a home involves various additional expenses, such as paying rates and taxes, electricity and water bills, homeowners insurance, sufficient life cover on your mortgage, as well as the cost of maintaining your property. It would also be prudent to factor in headroom for any potential interest rate hikes – you should be able to cope with a minimum of a 2% increase over the next 12 to 18 months.
Any lender needs to determine that you have had a stable income for at least two years. As such, self-employed individuals or commission earners will need to prove this aspect of their income before a home loan will be granted.

Save, save and save some more
It is essential that you improve your disposable income by as much as you can, as credit lenders will take this into account when they calculate the size of home loan you qualify for. For every R1 300 you can save on your monthly financial obligations, you will be able to increase your home loan spending power by a full R100 000. Also, being able to save a big deposit of around 20% to 30% offers the lenders assurance that you are working towards a good credit rating and that you have the financial means to meet future obligations relating to the loan. The bottom line is that the more money you have saved to put towards buying your home, the better chance you will have for being approved for a home loan.

Work with a home loan originator
In order for you application to go through smoothly, you should get all the required documentation ready beforehand. Applying for your home loan with the help of a mortgage originator instead of taking the DIY approach will greatly improve your chances of success. Mortgage originators are professionals who understand the various procedures of the different banks. They know which paperwork to submit to motivate your application, they can help negotiate the best possible interest rates and they will help you through the entire process until your home loan is finally registered. The best part is that this service is free of charge for the homebuyer.

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