Reserve Bank Cuts Interest Rates

July 20, 2012

I’m very pleased to share with you that yesterday the South African Reserve bank but it’s REPO rate by 0.5% or 5 basis points.

 

This means that banks and financial institutions should now all be on par with a prime lending rate at 8.5% – this is the lowest rate in over 30 years and is welcomed by all.

Read the rest of the story here:  http://www.property24.com/articles/prime-interest-rate-cut-to-85-percent/15881?SourceFeed=News24

* information correct as per time of posting

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The functions and benefits of a mortgage calculator

July 9, 2012

Buying a house requires a lot of money. Due to this, it is necessary for most people to take out a mortgage for purchasing a house. If you want to purchase a house in the near future, then you should possess a clear understanding of your financial affordability, before you take out a mortgage.

This is because mortgages are big liabilities, for which proper payments have to be made. If you fail to make payments for your mortgage, you can lose your house in a foreclosure. Thus, to make regular payments for your mortgage and to obtain complete control over your house, it is very crucial to understand how much house you can afford, before you take out a mortgage.

In this regard, a mortgage calculator can prove to be useful. This article highlights the benefits that you obtain by using a mortgage calculator.

Mortgage calculators: Functional and beneficial

Go through the points below for understanding the functions and benefits of a mortgage calculator:

  1. Understanding how much mortgage you can borrow – The most discernible function of a mortgage calculator is to help a borrower understand how much house he can afford. With the help you a mortgage calculator, you can determine how much interest you’d be required to pay for your mortgage, each month.

    Moreover, you can include important details regarding term of the loan, deposit amount and rate of interest for getting a better understanding of your affordability.

  2. Getting a better idea about the interest rates for adjustable-rate mortgage – Mortgages can be fixed-rate or adjustable-rate mortgage. In case of an adjustable-rate mortgage, the interest rates can fluctuate from time to time. It usually remains stable in the initial period, after which it keeps on fluctuating.

    Many home owners prefer adjustable-rate mortgage because the interest rate can be quite low in the initial period. However, the interest rate can become very high once it starts to fluctuate. A mortgage calculator can help you to understand how much the interest rates for an adjustable-rate loan can go up.

  3. Understanding when can you get rid of private mortgage insurance- In most cases, if a borrower provides a down payment of less than 20 % of the house’s purchase price, he’ll be required to purchase private mortgage insurance. If you do the same, you can take help of a mortgage calculator to find out when you can eliminate private mortgage insurance.

    A mortgage calculator will help you to comprehend when your house’s equity will reach 20%. In such a situation, you can ask your lender to wave off private mortgage insurance.

  4. Figuring out if refinancing a mortgage can be helpful – Refinancing a mortgage can be helpful for home owners who have already taken out a mortgage and are facing difficulties in making payments for it. By refinancing, they can substitute their existing loan with a new one, which contains more favorable terms and conditions.

    In case you face any crisis in making payments for your mortgage, you can take help of a mortgage calculator to figure out whether mortgage refinance will actually be helpful for you or not.

Thus, there are a number of important functions of a mortgage calculator. You’ll find a huge number of mortgage calculators on the Internet.

* information correct as per time of posting