The mortgage origination value chain consists of the home buyer, estate agent, mortgage originator, attorney and the lender (bank).

1. Seller
The seller is the registered owner of the property to be sold. The seller could:
• Approach an estate agency to sell the property on his/her behalf
• List the property for sale through a direct selling mechanism on the Internet
• Sell the property directly to a prospective buyer.

2. The buyer
The buyer of a property enters into an Agreement of Sale with the seller of the property and could pay the purchase price to the seller in cash or by obtaining a home loan or mortgage through a bank. A buyer is also a person buying a stand and building a dwelling on the stand.

3. The estate agent
The estate agent is the starting point within the value proposition to the homebuyer. Although appointed by the seller, and primarily looking after the interests of the seller in terms of listing the property and finding a suitable buyer as close as possible to the seller’s asking price, the estate agent is compelled to operate and advise homebuyers within the guidelines and policies of the Estate Agency Board, the Regulatory Body for Estate Agents. The estate agent adds value to the homebuyer in finding a suitable property to satisfy the needs of the homebuyer.

4. Banks
The bank is also referred to as the lender. When the originator submits an application on behalf of the homebuyer to the bank, the bank will assess the application based on the creditworthiness of the applicant, the affordability of the loan for the applicant and the security that is offered for the loan in terms of the value of the property to be mortgaged. Based primarily on the risk the mortgage loan represents, the bank will offer the home buyer a suitable interest rate. The normal repayment period for a home loan is 20 years. After registration of the home loan, the applicant becomes the client of the bank.

5. The attorney
By law a conveyancing attorney is the only person who may register property transactions in the Deeds Office.
When there is a mortgage bond registered over a property, and the purchaser has procured a loan secured by a mortgage bond to pay the whole or part of  the purchase price, three basic types of transactions are applicable:

• The cancellation of the seller’s existing mortgage
• Simultaneously, the transfer of the property into the new owner’s name
• And also simultaneously, the registration of the purchaser’s bond

There is a fourth possibility – that the property transactions may be  in the sense that, for example, the purchaser has sold another property, and the proceeds of that sale, or part thereof, are used to pay the purchase price of the property he/she is now buying.

6. Mortgage originator
A mortgage loan originator or mortgage broker is a licensed professional who arranges mortgage financing for potential homebuyers. While a loan originator usually represents a particular mortgage company, the mortgage broker may possibly represent more than one lender. In either case, the job is to assist the borrower by beginning the borrowing process through the completion of a loan application, and gathering of the necessary documentation, such as income statements and credit reports.

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

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011.327.4489 / 0861 1111 93

morne@mortgagepluscc.co.za

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Top 10 Questions to Ask Your Agent

Choosing the right estate agent is a crucial step in the process of selling your home. The easiest way to find out if an agent is suited for the job is to ask as many questions as possible. Here are 10 of the most important questions to ask to ensure you are dealing with the right agent: 1.  What experience do you have? It is vital that you establish the amount of experience and knowledge an estate agent has before you choose one. Also remember to ask about other special certification or areas of expertise that the agent might have. 2.  Where will you be advertising my property? A good agent will use all advertising mediums to advertise you property including billboards, brochures, open houses, newspaper and online listings. Be sure to also ask how often ads will be published. 3.  What statistics can you show me about previous sales? An estate agent should have a record of their previous transactions, including how many properties they have listed, how many properties they have sold, the average time it takes them to sell a property, etc. Use this opportunity to ask why some properties were not sold. 4.  How accessible are you? You need your agent to be easily accessible 24/7. If an agent tells you that they are only working part time, you have to accept that he/she won’t be available most of the time. You also want your estate agent to attend the open house personally and not an assistant.  If you are only available on weekends, make sure that your agent is willing to work weekends. 5.  What is your commission cut? Make sure that you agree on this and that you are aware of all terms and conditions. 6.  Do you have contactable references? Ask for the contact number of the agent’s last three clients, which does not necessarily mean the last three clients that had their properties sold. You want to hear the good as well as the bad. 7.  How many properties do you currently list in my area? Note that it is a good thing if an agent has had a large number of properties in your area, because this way he/she will be up to date with recent sale activity in the area as well as market prices. What you don’t want is an agent that has a large number of properties in a more expensive area, as this might mean that he/she will focus more on the properties that offer more commission. 8.  Are you registered with the Estate Agency Board? The agent you choose should be registered with Estate Agency Affairs Board (EAAB) of South-Africa. You can contact this organisation to ensure that your agent is registered and that he/she has a clean record, meaning no complaints have been filed against the particular agent. Visit their website for more information: http://www.eaab.org.za 9.  What listing price do you suggest and why? This is a very important question and the agent’s knowledge, experience in your area as well as reasoning behind the price should be taken into consideration. Beware of agents that say “yes” to any price. 10.  Do you offer any other services? Ask agents if they offer any other services and if they can make referrals such as property inspectors, bond originators, moving companies etc. Also find out if an agent has any help from assistants or other staff to ensure that he/she will be able to get to all the services that is promised.

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