Tuesday, 24 March 2009

How Loooooooooooooooooow can you go?

Whoop whoop whoop....

The magic word for the day is "repo"

The magic man of the moment is "Tito Mboweni"

The magic phrase for the week is "How loooooooooooooow can you go"

Interest rates today dropped a whopping 1%.
Our current rate is 13%.

Lets keep it coming.

Monday, 23 March 2009

Estate Agents - Has the time come?

Happy Monday to everyone.

So, some of you have heard the banks have dropped their commission offerings to bond originators.

So, has the time come? Is the end of the line for estate agents commissions who've been eating away at the profit of bond originators for years!!!

Bottom line is: If bond originators carry on paying estate agents commissions, they'll go out of business...If they go out of business, estate agents won't get their 7% commission charges, which means, ultimately, that bond originators pay agents their salaries :)

Your thoughts? Is it the end of the line for commission payments to estate agents?

If you're bond originator, what are you doing to save costs in your business and what are you going to do about banks dropping commission offerings?

We'd love to hear!!

Sunday, 22 March 2009

Earth Hour South Africa

I just saw this watching IDOLS on TV, and I think we should most definately spread the word!
Lets please support Earth Hour and give your support.

Interest Rates Might Drop But Banks Aren't Helping!

There's alot of speculation out there that the banks are now starting to give bonds again and are wanting to get back into the bond market. Well, fact of the matter is, if you're using a good bond originator, you should be getting your home loan approved anyway ;-).

So, does this mean we're going back to the good old days of 108% grants @ -2.5% below prime. NO!

In fact, what we're finding, is that although the banks are giving bonds, they're still in the business of making sure they're going to make money from you!

All this hype of interest rate drops!!! WOW I'm so excited! NOT!

Not only are the banks asking you to fork out your life savings to put down a 10% - 20% deposit on a property, they're increasing the interest rates that they're giving out to you! The home loan interest rates at the moment are ranging from between 2.5% ABOVE prime to 1.5% below prime.

So TITO, let me ask you! What's the point of dropping interest rates down 0.5% every 3 months if the banks are going to push their rates up every time you do this?


Readers - What are you thoughts????

Monday, 2 March 2009

Bond Originators Are Worth IT & They're Here To Stay!

Let me tell you, when I read this headline in the Sunday Times news paper yesterday evening, my knees went wobbly and I finally realised that there are people in this world that know what they're talking about.

Well done Saul Geffen, you are the man, and I do share your sentiment.

Bond Originators are here to stay, whether the banks wants us or not!

The fact is - the banks needs us, clients need us and if bond originators in South Africa and worldwide for that matter can just learn to bring good quality bonds and leads through to the banks we can and will assist them in making the home loans division of the banks a profitable, steady and reliable source of income that no other department or division will ever be able to make them...

So all you bond originators, keep the bonds tidy, keep them clean and be honest with your clients upfront, and not only will we keep our contracts with the banks, but we'll make it so worth their while that they'll be throwing those parties for us in the Carribean, because we actually pulled them through this recession.

Just to highlight the interview with Saul Geffen from Ooba in the Sunday Times:

How do I negotiate better interest rates from my bank?
Do I need a bond originator/should I go to my bank?

1. The size of your bond and deposit definitely affect your rate concession. Banks require buyers to have a deposit of between 5% and 30% of purchase price.
2. The banks check the credit history of yourself and your spouse/co-applicant/surety and if not conducted correctly, could have an adverse effect on your application.
3. If you are divorced or separated, make sure you are not linked to any debt or open credit facility with your ex.
4. Cancel old credit cards as this will make lenders wary about the potential size of your total debt – if you don’t need the full credit limit offered on a card, have it reduced and the same applies to retail credit.
5. If you are a first time buyer, consider taking out a credit card 6 months prior to making a bond application. You will need to pay your balance in full on time each month to show your diligence in managing your debt.
6. Your salary/income needs to be deposited into a bank account as the banks will ask for proof of income via your bank statements, accuracy is paramount.
7. If you have credit problems, always keep proof of payment and outstanding debts have to be removed from your file.
8. Pre-qualifications should be done so that you can be in a stronger position to negotiate with the seller.

Do I need a bond originator/should I go to my bank?

Origination makes even more sense in the global credit crisis as banks have tightened lending criteria and are not under pressure to offer interest rates below the prime rate for their mortgages.

Bond originators act as negotiators on consumers’ behalf. For every 0.5% concession to prime, the saving on R1-million home loan represents a saving of R86 750 over the life of the standard 20 year bond.

The benefit of having one’s home loan application assessed by several banks is that it gives the consumer the best chance of a better deal.

The originators service is at no cost to buyers and there is no obligation to accept a particular loan.

Originators also guide buyers through the voluminous paperwork required by the National Credit Act.

Are banks cutting out originators?

Some banks are looking to reduce commissions to originators, given the impact of the higher cost of funding and bad debts on bank margins.

But, origination remains the key distribution channel for home loans and banks recognize the strength of origination as a distribution mechanism.
WizardMan Out - Good Night All!