The banks get tough in their home loans lending

100% home loans - diminishing as we speak - but still possible.

Interest rates of -2% below prime - forget it - you are lucky if you get prime and it will get worse for a while.  But our rates are at their lowest in 30 years so that's great news.

1  * Bounced cheque on your last 3 months bank statements - better you wait until the next three months cycle before you apply for a mortgage.

Adverse on your credit report - get it sorted and get it removed and get letters and even then you are bound to be declined by the banks first.

A Judgement - get someone else to buy the house because you are just not going to get a loan, unless you own your own bank.

Get a credit check if its the last thing you do and understand it.

Self employed - well you need about three tonnes of documents including 3 years financials, 6 months business bank statements, blood tests and 6 financial sponsors - very tough at present.

If you earn as a salaried employee an amount of between R 10 and up in overtime, commission you better get your 6 months payslips, commission statements and letters from your company proving that you earn occasional extra income otherwise your whole profile will be seen as suspicious and you WILL be declined.

if you are non-res, non SA type make sure that you have approval to bring your money in, an excellent money transfer service, attorneys that are jacked up and 50% is the max you will get and probably from 2 banks only.

So folks that's the good news....and its bound to get better.

Want a home loan - well use a mortgage originator because they are the only people who will tell you like it is as they earn their hard earned living from this business.

Pension Supported Housing Loans

ABSA offer a superb product.  Pension Supported Housing Loans
What is a Pension-supported Housing Loan?


A pension-supported Housing Loan is an alternative way to fund any aspect of one’s home. ( can be used to fund the banks LTV lending limit variances – or for registration and transfer fees in relation to new and further advance Home Loan which must be the employee’s normal residence)

It is so named because the pension or provident fund benefit due to an employee can be used as security against the loan without eroding the retirement benefit. The amount borrowed is guaranteed against the fund – it doesn’t come out of it. This means that the employee’s pension or provident fund value is only affected in exceptional circumstances.

Percentage Borrowings

The Fund Managers, Trustees and Employers determine the maximum amount that can be borrowed as well as the percentage and payback terms. The percentage could vary between 50% and 80% of the employee’s withdrawal benefit.

Term

The Absa Pension-supported Housing Loan must be repaid within a maximum term of 30 years or by the time the employee reaches normal retirement age – whichever comes first. i.e. retirement age 65 – present age 45 = 19 years max term of loan


Key Benefits of the PSHL

Absa Pension-supported Housing Loans have a prime-linked interest rate that depends on the potential total value and number of loans in the fund. In this way, members get the benefit of a group-based interest rate, which favours lower income earners in particular.


Absa does not charge initiation fees or monthly service fees in most cases, thus making it affordable and significantly cheaper than another loan.

Credit Life Insurance is available from Absa which covers death, disability and retrenchment to help make sure the loan is paid off in the event of any of these happening. The monthly premium is charged to, and included in, the repayment.

The fund will settle the loan when:

The employee leaves the company and stops deductions

The employee resigns from the funds and withdraws his or her benefit

The employee is disable, retrenched or dies (where no insurance option was in place

The employee retires and there is an outstanding loan balance

The employee defaults on the loan if it is not remedied in time

6 Ways to Better Manage your Household Debt

Happy Monday to all... For those of you who've been watching the rugby, I hope you all feel as terrible as I do today. I think I'm officially beginning to get old! Thank goodness this rugby thing happens once every 4 years!

Anyway, I have a great little debt management tip article to post today courtesy of Absa Home Loans Department.

6 Ways to Better Manage your Household Debt

• Draw up a monthly budget of all income and all expenses and stick to it.
• Speak to your creditors about alternative repayment arrangements. Most will be happy to help you.
• Always pay your essential expenses first, like electrical and water bills etc.
• Try to settle high-interest accounts first
• Don't make emotional, impulsive purchases - especially not on credit.
• Shop around for bargains and cheaper prices

WizardMan out!

Manage Your Debt Responsibly

Hello all... So good to see that people are still reading the SA Property BLOG, and we're proud to say that it's now the number 1 portal and information station for all South African property and finance related information.

Seen as the only ongoing and exciting news in the world of property right now is the national credit act I though we'd put together a little list on how to manage your debt responsibly. We get endless phone calls and email from people asking us about credit issues that they have, and personal loan debts and it's quite sad to see that so many people are in the financial dilemma's that they're in...

So once again in an effort to help South Africa become and debt free society here's the TOP 10 yes TOP 10 debt management tips and hints that help people Manage Their Debt Responsibly.

• Avoid Making Impulse Purchases - If you don't have the extra cash to blow, avoiding blowing it. Instant gratification is all fine and well but it ain't that great when that bill arrives and you realise you can't afford it


• Speak to your creditors - When you're in financial SHIT, speak to your creditors, tell them the predicament you are in and come to a mutual agreement and understanding, even if it means dropping your monthly payments. Missing payments will affect your credit ratings.


• Get credit only from Registered Credit Providers - Stay away from loan sharks unless they are registered.


• Always make your monthly repayments by your due date - NEVER MISS EDGARS ACCOUNT REPAYMENTS. These guys will list you in 2 ticks...


• Pay off your credit - Any extra money that you have at the end of the month, use to pay of your credit. If you have, put this cash into your bond account. At 13.5% interest you won't get better rates anywhere else.


• Kill your small account first - Alot of people say kill the loan with the highest interest rates first (normally your bond account) but I'd suggest killing the smaller ones quickly, thus reducing the amount of accounts to pay off.


• Moving Debt - Don't move short term debt to long term debt to increase your monthly cash flow, your interest rates will increase


• Don't stand surety for anything unless you can handle it - This is a killer. People sign surety for other people without realising that they become responsible for repayments should the other person for whatever reason not be able to pay. WATCH OUT!


• Live within your means - Don't over commit.


• Know your credit ratings - Check yourself out at least once a year. You can get a free credit check on your birthday from the credit bureaus. Otherwise Wizard can get you credit checks for a price of R125.00. See Credit Checks for more information

For a DEBT FREE SOUTH AFRICA!

WizardMan Out!