Nedbank Home Loans

Nedbank home loans cater for a variety of individuals within South Africa and include four different types of home loan choices.

• Original home loan
• Buy to let home loan
• Building home loan
• Home vision home loan
• Original Nedbank home loan

Qualifying criteria includes individuals earning at least R2 500 in monthly household income and must have a clear credit record. Property value to a minimum of R100 000 needs to be obtained prior to applying to the loan.

Individuals may furthermore repay their loan to up to 30 years with interest rates being fixed or variable. Other flexible facilities with this home loan include options to apply for

a re-advance where individuals who have paid off some of their loan may apply for the same amount.
NedRevolve facility which allow individuals to withdraw the funds which they have paid in surplus on their home loan.
an accelerated payment option where individuals may pay more than then minimum installment in order to speed up repayment of their home loan.
With the ever changing markets home owners with this loan option may also apply for a higher loan amount if the value of the property has increased.

Buy to let home loan

This loan is given to individuals who want to invest in a property with the aim of renting it out to other individuals. Qualifying criteria includes individuals having to earn at least an income of R30 000.00 and should have a clear credit record. A property value with a minimum amount of R150 000 will only be considered.

Building home loan

Qualifying factors include that individuals earn at least R2 500 per month and have a clear credit record. Individuals can only apply for this loan when a property with a minimum value of R150 000 will be build. Builders must be able to proof that they are NHBRC approved.

Home vision home loan

When the value of your property increase home owners may apply for a home vision loan. The difference of the original loan and the new property value may be utilized for most purposes if approved.

Home owners are encouraged to apply for this loan instead of a second mortgage as costs levied are much lower. The minimum property value has to be R100 000 to apply for this loan.

Nedbank branches can be found all over the country but individuals may also logon to the Mortgage Plus website to apply online in the comfort of their own homes. The website is very informative and individuals may also make use of the home loan calculator to determine the value of the home loan they might qualify for, repayment terms and installment amount.

All clients will be subject to a credit check and affordability in terms of the NCA (National Credit Act), and all properties will be evaluated prior to approval.

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

CAPE TOWN – Absa (JSE:ASA) recently made a big song and dance about its MyHome product, helping those households who earn less than R15 142 a month to buy a property by offering them a 110% bond, no deposit required and all bond costs included in the bond. Is it now the low-income bond market leader and what are the other banks offering in that sector?

A Standard Bank (JSE:SBK) spokesperson referred me to a release it sent out last year where the bank relaxed its credit restrictions, claiming it was the first to do so. The changes it made were specifically designed to benefit first-time entrants into the housing and general credit markets. They were not for the low-income bracket but aimed at those with a solid income but don’t necessarily have a sizeable deposit to put down.

Its Jump Start Bond allows first-time home owners to apply for a bond of up to R1m, to qualify a household needs a combined income of close to R30 000 and monthly repayments will be close to R10 000 a month.

As long as they use the residence they are buying as their primary residence they are able to qualify for a cost-inclusive 104% LTV (loan-to-value). The loan-to-value ratio expresses the amount of a first mortgage lien as a percentage of the total appraised value of real property. For eg, if a borrower wants R450 000 to purchase a house worth R500 000, the LTV ratio is R450 000/R500 000 or 90% (LTV)).

Standard Bank now allows LTVs of 100% (up from 90-95%) and it has started accepting low-risk non-cheque Standard Bank customers and low-risk non-Standard Bank customers for home loans.

Standards Bank’s Dream Start Bond is more suitable to low-income earners. It is aimed at those earning a single or joint income of between R1 500 and R6 000 a month, excluding housing subsidies or allowances.

First National Bank’s contribution to the low-income bond market is the Smart Bond. This is for applicants earning a monthly household income of R15 000 and below. Those applicants who qualify for the Smart Bond will be eligible for 100% bond finance, with no deposit required.

Nedbank (JSE: NED) also relaxed its lending criteria last year. Whereas for the previous year the bank required deposits of 10 – 20% for new home loans, this was driven mainly by expected declines in house prices, the deposit requirement has now been reduced to 0 – 10%, depending on the risk profile of the client. Clients also have the option to have a five-year fixed interest rate or a variable interest rate. Home-ownership education programme is provided to first time home buyers – for free and the minimum loan amount is R20 000.

For low-risk clients – both existing Nedbank clients and new clients it will lend up to 100% of the purchase price of their new homes. In general, though, it continues to believe that putting down a 5 – 10% deposit is good practice for both the client and the bank, and therefore will continue to encourage clients to do likewise.

While all banks do seem to cater for low-income earners it appears that Absa’s 110% offering is the most effective product targeted at these earners. The fact that borrowers who take advantage of the product receive the added benefit of an HIV/Aids voluntary counselling, testing and treatment programme seems to place the red branded bank as current market leaders in this sector. Absa has also sourced insurance so that should a client fall ill and be unable to work due to an Aids-related disease their home loan instalments will be covered.

CONTACT US
For more assistance with regards to Applying for Home Loan Finance .
Email: morne@mortgagepluscc.co.za
Ph: 011.327.4489
or Complete This Online Form