Mortgage Basics – South Africa

The type of loan you select will affect not only the amount of interest you pay to the lender and the term or life of the loan, but can also have other options and add-ons that can help you realise future financial goals.

Interest Rates and Life of the Loan

Typically, the maximum life or term of a mortgage is 30 years, but almost any other time period can be negotiated, with shorter loans sometimes attracting cheaper interest rates. A lower interest rate and shorter term on the loan means you will pay less interest to the lender over the term of the loan; Saving you money.

However, monthly payments on a shorter loan will generally be higher than those on the same loan set for a longer time period. The higher payments are obviously required to repay the debt sooner.

Conversely, a long term loan with smaller payments can be easier to budget for and mean less lifestyle sacrifices will need to be made. If you can afford to pay off your loan sooner, then a shorter term loan is often more advantageous.

Fixed Rate vs Variable Rate

The two most common loans offered are fixed rate mortgages and variable rate mortgages. A fixed rate mortgage comes with an interest rate that is fixed for a set amount of time whereas an variable rate mortgage will fluctuate as the market changes.

The benefit of a fixed rate mortgage is to protect you from the risk of increasing interest rates and subsequently higher repayments. If interest rates rise, you are fixed on paying the lower rate. Conversely, if interest rates should fall, you are locked into the fixed rate and will pay above market rates for your home loan.

A variable interest rate home loan allows interest rates to fluctuate with the market, depending on the economic environment.

Initially, a variable rate will be lower than the fixed rate loan. However, if interest rates do rise in the future, it is likely the fixed rate loan will be cheaper.

Deciding whether a variable or fixed rate loan is best for you will come down to your unique financial situation. For example, if you expect your income to rise in the future, then a variable rate loan will help you to pay more back in the short term and should rates rise, you can still afford the loan because of your increase pay. You should also consider your risk tolerance. A fixed mortgage lets you plan and budget sometimes years in advance to make sure you can continue to afford the loan.

If you need help identifying which loan option is best for you, contact a Mortgage Plus broker for an obligation-free discussion. Your broker will advise you on the various options and benefits of different home loan products and work to get you the best deal on your loan.

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

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