With hundreds of mortgage products on the market, it is not always easy to know where to go to obtain the exact bond finance you need at the time and in the circumstances. That’s where the mortgage originator comes into the picture. “However, many people are unsure of exactly what services a mortgage originator should offer and what benefits they provide.

The key function of a mortgage originator is to introduce a borrower to a lender and to act as a personal consultant in an attempt to help you obtain mortgage finance for a property. “The mortgage originator will apply to and negotiate with a financial institution in respect of the home loan on your behalf”.

A mortgage originator should have a specialized knowledge of the various products and rates available on the market in order to give independent advice with the aim of obtaining the most suitable bond from the most appropriate mortgage lending financial institution for your particular needs. They should help you assess your affordability and explain fully and in plain language the material terms which you need to be aware of to make an informed decision.

“While you are not obliged to use their services, it can make the process much quicker because of their familiarity with the process, products, assessment yardsticks and requirements of the individual financial institutions. With a mortgage originator you only have to fill out one application and they request only one set of the relevant prescribed supporting documentation, such as identity documents and salary advice slips, required by the financial institutions. They then submit the application to the various financial institutions on your behalf and try and negotiate a lower rate for you. “It is generally understood that a bond originator is able to secure a cheaper rate than if you approached the bank directly as they are on a better negotiating platform. A good mortgage originator should also follow up with the financial institutions on a regular basis and keep you informed.

Once the mortgage originator receives the various quotations they should sit down and help you to assess your options, advising you of the pros and cons of each with your particular needs in view. “Essentially the final decision should be yours after weighing up all your options and taking into consideration the advice and recommendations of the M.O. Do not feel obligated to make any specific choice.”

Apart from providing you with information on the various mortgage products they should also be able to assist you with conveyancing and related costs.

The mortgage originator is usually paid a fee or commission by the lending institution with whom the loan is taken up, so the service should be free. It should not be necessary to sign a sole mandate and if they request you to sign any agreement between them and yourself make sure you are fully aware of the legal and possible financial consequences.

“Remember they do not have control over and cannot therefore accept responsibility for credit decisions or valuations made by the mortgage lending financial institutions, it is a good idea to approach a mortgage originator before you go house hunting so that you know what loan amount you will be eligible for.

Should you have any problems complaints may be addressed to the Office of the Ombudsman for Mortgage Originators which has been set up to deal with complaints against mortgage originators who are members of the National Association of Mortgage Originators.

Mortgage Plus offers a wide range of advice on different bond options and further advice on the above. Please call us for further information on:

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Call us on 011.327.4489

Email: morne@mortgagepluscc.co.za

www.mortgagepluscc.co.za

Home loan advice for first-time buyers

Looking to buy your first house, flat, or other type of residential property? Be sure to read on for some critical advice on buying a house and applying for your first home loan…

Do your homework properly – www.propertymax.co.za
Informed buyers get better bargains. If you familiarise yourself with the property market and get a feel for what properties cost in a certain area, you will recognise a good deal immediately, while simultaneously ensuring that you don’t end up paying too much for a property that isn’t worth it.

Be realistic about what you can afford – Affordability Calculator
A good property doesn’t come cheap, and a good property buy is more than just a house – it’s also the location that counts. Yet everything comes at a price, and you may find that you have to sacrifice on space or an extra bedroom in order to buy a property in a more sought-after area. Don’t be disheartened – the challenge is to get into the property market and buy wisely. The last few years’ rapid growth in the property market seems set to continue, which should help you to afford a bigger, more valuable property as time progresses and property growth continues. But first, you have to make inroads into the market as a buyer!

Location is everything
If you wish to buy a property with good investment potential, the neighbourhood you buy in will be a key consideration. If you are looking to buy a family home, it may also be worth your while buying a house close to schools, crèches, etc.

Also attempt to find a home that is situated relatively close to your place of work, as traffic congestion and increasing commuting times can also influence a residential property’s price.

Read – and understand! – the fine print
Buying any property comes with a fair amount of administration. As a first-time homebuyer, you’ll need to familiarise yourself with the mortgage application process, so be sure to ask questions if you don’t understand something. Also have your mortgage contract documents and application forms explained to you in detail, and keep copies of all signed documents in a safe place.

Choose a home loan that best suits your needs
Unsure of which bond solution to choose? If you’re a first-time buyer, why not talk to one of our qualified home loan consultants. Who can advice you on how to meet the home loan requirements of first-time homebuyers.

Allow for interest rate increases
When calculating your budget, it is important to bear in mind that the prime interest rate will influence your monthly home loan instalments if your bond features a variable home loan rate. Unless you opt for a fixed rate home loan solution, any adjustments to the prime rate will directly affect your home loan interest rate.

If prime is lowered, your monthly instalments will in turn be lower, and visa versa. If it increases, however, your monthly instalments will increase by substantial amounts. As such, it is advisable to allow for potential interest rate hikes when calculating your budget – even before buying a house! Be sure to use our
bond calculators to see how big a loan you could qualify for, and also to assess how much you’ll need to allow for potential interest rate increases.

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