Home Loans Cape Town – Can You Trust Your Bond Originator?

September 17, 2010

Home Loans Cape Town: Have You ever felt left in the dark by your bond ofiginator, not knowing what’s going on with your home loan application?

Many clients have told me that when this happens, they start to question whether the originator knows what she’s doing. 

Have you ever felt like this? ….well, you’re not alone

Click here to read the rest of this home loans cape town article.

* information correct as per time of posting

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Standard Bank = 100% Home Loans Again!

July 26, 2010

For more information on Standard Bank’s 100% Home Loan Policy, visit:

http://homepurchaseloans.blogspot.com/2010/07/standard-bank-has-joined-100-party.html


Calling all ABSA account holders

March 19, 2010

Courtesy of:  http://homepurchaseloans.blogspot.com/2010/03/calling-all-absa-account-holders.html

Are you an ABSA banking client looking for a home loan?

Until 30 April 2010 they’ll be offering special deals for individuals looking for home loans of R500 000 – R1 500 000 (excluding building loans, investment property, vacant lant, and fixed rates)

Although they haven’t disclosed what’s going to be making these deals so special, I’m guessing better interest rates.

If you’re one of those, don’t hesitate to contact us or click here for more information on ABSA home loans


Should You Refinance SA Home Loan?

January 12, 2010

There are many great reasons to refinance your SA home loan and it may be a wise financial decision.

Some of the more popular reasons to refinance include lowering your interest rate, lowering monthly payments, debt consolidation and decreasing the home loan term to build equity quicker.

But, before you decide to refinance you need to the sums to determine if the cost of refinancing would be worth. Keep in mind that if your goal is to save money, you to calculate your break even point.

Your break even point is the point where your savings covers the cost of refinancing SA home loans. As a rule of thumb, the longer you intend on staying in your home the more feasible it will be to consider refinancing. It is a fairly simple calculation to determine your break even point which will help you to figure out when you will start saving money.

Add up the costs (prepayment penalties, registration costs etc.) of refinancing your home loan and divide the total costs by the amount you save each month. This will show you the number of months it will take before you start seeing real savings.

For example, if you refinance SA home loans your closing costs could end up to be R14,500.

Also your mortgage payment have gone down from R4,900 to R4,000 which translates into a R900 monthly saving. Divide the R14,500 by R900 which means that it will take you 16 months to break even. This is a fairly simple explanation, but it should help you to calculate if you should go through the exercise of refinancing your SA home loans or not.

In the above example if you plan on staying in your home for longer than 16 months it will be a wise decision to refinance


The Home Loan Pre-approval Process

January 8, 2010

 To make sure of how much you can qualify for when applying for a home loan is to go through the home loan prequalification process. This is the first in formally applying for a home loan.

A prequalification is not a binding document and in many cases it is just a verbal estimate. It is an estimate of how much you can borrow based on your income.

A prequalification is not a loan guarantee and it is only as accurate as the information you have provided. Don’t try to overstate your income in the hope of qualifying for a bigger loan.

The lender won’t pull you credit record or commit themselves to what you can basically call a home loan quote. This is just a ball park figure to give you an idea of how much you can borrow.

If you’re serious on making an offer on a home you must complete a full application and the bank or your mortgage broker will need documents like payslips and bank statements during which time they will also confirm your employment and pull your credit record.

If everything is in order the bank will issue and AIP (approval in principle) which means that they are committed to give you a home loan as long as your credit or employment do not change for the worse.

Next, the lender will do a valuation on the home you would like to purchase and if they can find sufficient value in the property they will issue a final grant which means that your home loan is approved. The lender will instruct the attorneys to start with transferring and registering the property in your name.

 This process will take about two weeks and once you and the seller have signed the transfer papers it will take about another two weeks before the property is registered in your name.

For more information about home loans, visit:  http://www.gpfmortgage.co.za/contactus.html


Why a Personal Loan Won’t Work for Debt Consolidation

November 24, 2008

Debt consolidation explained…

Everyone needs to borrow money at some point in their life. It can be as simple as asking a relative for ten-fifty for a burger, to be paid back later, to deals with lending institutions involving amounts ranging from tens to millions of rands. Money may be needed to purchase a car, refurbish a home, or deal with a medical emergency. As long as the borrower can repay the loan, there’s no problem—the borrower gets a need addressed and the lender gets some profit out of risking their funds. It’s when the borrower runs into problems repaying that things start to go sour.

Basic Loan Components and Types

There are so many loan packages available today that it can be difficult sometimes to distinguish the best one for a particular need. All loans come with three basic components: the principal, which is the amount actually borrowed; the interest, which is charged by the lender and is the way by which they make a profit out of the deal; and the miscellaneous fees charged upon setup.

Loans come in two basic varieties: secured and unsecured. Secured loans involve the borrower pledging some sort of security to cover the deal; this is commonly in the form of cars or other belongings, or a home or property. If the borrower defaults on the loan, the lender can then seize the agreed-upon collateral and sell it to try and recover some of its money. These sorts of deals come with low interest rates because some of the risk to the lender is covered by the collateral.

Unsecured loans, on the other hand, don’t require collateral, thus making them easier to acquire but at the cost of higher interest rates, to make up for the increased risk.

Personal Loans and Debt Consolidation

Personal loans, which can come in both secured and unsecured forms, are among the most basic of loans. They are used for everything, from covering the purchase of new appliances or that shiny new sedan, to funding vacations and dealing with unforeseen events.

Some people also take out loans to use them in paying off other loans, but that isn’t advisable. For one thing, unless the borrower manages to snag a really good loan, the amount borrowed will never be enough to completely pay off a previous loan. Then the hapless individual winds up with an additional financial burden on their back.

When faced with multiple loans with considerable interest charges, one of the best courses of action could be to use a debt consolidation loan from a reputable firm. Taking this course of action could probably result in lower monthly payments and reduced charges, as well as address the inability of some debtors to manage their finances. Not only that, financial education conducted by some of these firms could also lead the borrower not only to debt freedom, but also teach them to live within their means and stop the endless cycle of debt repayment..

For other related articles and advice, please go to http://www.globalproperty.co.za


Refinancing – Is it for You?

October 27, 2008

What does refinancing actually mean? It means: replacing your existing mortgage with another, lower interest rate loan. There are many good reasons to consider refinancing, including lowering your repayments, shortening your loan term, taking advantage of your home’s equity, debt consolidation, cash out options etc.

Mortgage refinancing can save you a lot of money if you do it right. Overpaying on your mortgage, when refinancing, is a common mistake that homeowners make, which costs them thousands of rands in interest.

Deciding if you should refinance or not depends greatly on what your financial goals are.

If you are refinancing in order to pay less interest, you would not see the savings right away. This is because financial institutions charge fees when you take out a new mortgage, and in some cases you also have to pay a penalty for canceling your old mortgage. To determine whether refinancing makes financial sense for you, consider these issues:

The Loan Term

It will not make sense to refinance your mortgage and start over with a 20-year term should your existing mortgage almost be paid off.

The Interest Rate

A percentage drop of just one half to three quarters of a percentage point can result into huge savings over the long term.
However, to get the benefits of a lower rate, you may have to pay fees associated with the mortgage.

Refinancing Costs

Refinancing is a lot like getting a new mortgage. Your lender may charge certain fees to facilitate your new loan. The benefits of refinancing add up over time, so if you do not plan owning your home for much longer, the lower payments associated with the refinancing may not cover the costs involved.

As a rule of thumb, the longer you plan to stay in your home the more sense it will make to consider refinancing. If your refinancing expenses can be recovered within the first 24 months of the new loan, mortgage refinancing is probably a good idea.

Pre payment penalties

Many mortgages carry a penalty if you pay them off early. If you do not wish to pay such a fee you will have to give your financial institution a 3 month / 90day notice period. Some however do not charge such a fee and you should go through your original loan documents to make sure.

The break-even point

If you can determine your break-even point, then you can start figuring out when you will start saving money. This involves a very simple calculation.

Start of by calculating how much you will save by lowering your monthly payment. Then add the costs associated with refinancing and divide the total by your monthly savings. This will give you an indication of the number of months it will take to reach the break-even point.
However to get a more accurate estimate, use our financial calculators on http://www.globalproperty.co.za