So what is the reasoning behind the banks such as FNB and ABSA, and Standard bank and Nedbank offering access bonds and what do they do for us.
The reasoning is that when allowing a customer to increase their home loan balance to the original bond amount without going through a new credit assessment the banks are not acting as responsible lenders - a real no no for any lender
So, by only allowing access to funds that have been prepaid, the bank then assists, you the customer in ensuring that the home loan is paid off over the term of the bond as set out originally, without placing any additional financial strain on you the customer. trust me, if you are under strain you will complain.
Should the customer require more than their prepaid amount available, a credit assessment will be done as normal to assess the affordability, which will ensure that the customer can afford the additional credit they want. This in turn reduces the risk of the customer going into arrears in the event they start taking financial strain.
So what are the rules - well these vary from bank to bank but generally they are and include but are not limited to: The customer must have a transactional account at the same bank as the access account. The linked account must be in the same name as that of the bond holder and where the bond is in joint names, in the name of one of the bond holders. Home loan repayments must be by debit order or salary stop order. Customer should not be under Special Repayment Arrangement or debt review. Insurance cover must be up and running. No vacant land bonds. No foreign nationals and non residents.
Call a bond originator today and they can immediately send you details for all banks at once.