01 June 2007 - Credit Act portal! 3...2...1....

Wizard have put together a nice Credit Act portal for your viewing pleasure. Any National Credit Act updates and changes, plus any news affecting bond originators and property specialists will be posted here. If you have any good links or would like to add anything to the new Credit Act portal please let me know... read on

Looks like the price of living is going up folks!

Listening to the radio this morning after an incredible weekend in Hoedspruit was rather a bland and sorry end.

I heard some news headlines that made me quiver. The reason it made me quiver was that I realised this weekend that there are alot of people in South Africa that JUST DON'T KNOW HOW TO LOOK AFTER THEIR MONEY. It's not something to be ashamed of, it's just that when you're in financial SHIT, get help! It's doesn't go away, it gets worse. Ok back to why the headlines made me quiver...

Firstly we're looking at a 69c hike in petrol (Those of you who are driving those fancy BMW 4x4's paying R10 000 per month when you can't afford it - Think again)

Secondly, because of this hike in petrol prices and the inflation rate looking at little unstable at the moment, we're in for another interest rate hike.

Thirdly, looks like Eskom are going to raise our electricity prices. Reason being, well all those beautiful outages we've been having in the last couple of months is forcing Eskom to build a couple more power stations to cope with the demand. And guess what, they need our money!

This is going to hurt alot of people in the next couple of months if they don't start watching their money!

SO PEOPLE PLEASE LOOK AFTER YOUR MONEY. IF YOU NEED ADVICE EMAIL ME. IT'S FREE!

Then I have a small issue with this country and a bone to pick with:

1. Telkom
- ADSL lines, finally back up after 3 weeks. PATHETIC considering you're the driving force behind this countries telephony
2. Municipal bodies
- Major town's in South Africa, not having water for 5 days!!!!!! (Ermelo I feel for you), it's pathetic. You'd swear we don't pay enough taxes in this place.

Anyway, that's my rant and rave session for the afternoon!

Have a super one readers!
WizardMan Out!

National Credit Act - Top 5 List!

With June 1st looming people seem to be heading into a state of panic. We've had thousands of queries about what the credit act is and by the look of search trends on the net this month... It's a big deal to South African's, and rightly so.

It's nothing to be scared of, unless of course you're hiding something ;-) in which case, be careful! The NCA are apparently a force to be reckoned with. It is however a BIG step forward for South Africa and it's about time we started regulating credit!

Here's Wizard's TOP 5 list of positives for the National Credit Act!

1. Prevent the reckless lending of credit
2. Preventing South Africans from taking credit without being able to afford it
3. Monitoring of interest rates for all credit lending
4. Customers will be protected by the ACT
5. No more misleading and deceptive marketing by credit lenders will be allowed

Welcome to a step forward in South African history. For more information please go to http://www.nca.org.za or check out the National Credit Act.

WizardMan Out!

Hoedspruit, Raptors View Wildlife Estate

Incredible, Inspiring and breathtaking...

3 words I can use to describe the place I'm sitting in right now. Hidden deep inside the South African lowveld lies a little treasure called Hoedspruit.

Surrounded by thick wild African bush and game farms filled with the finest fauna and flora, this magical town must be one of South Africa's best kept secrets.

WE'RE GIVING YOU A CHANCE TO OWN A PIECE OF PARADISE.

Jordan Properties are the first group of developers to build the amazing lifestyle village in the Hoedspruit area. Wizard home loans are the selected mortgage origination company chosen to do the financing for all these developments.

Raptors View nestled at the foot of the Drakensberg mountains is situated next to Welverdiend, Wild Rivers and the Thornybush reserve. This is where the incredible and almost overwhelming Raptors View Wildlife Estate is situated. It's the perfect getaway, with pastimes and activities such as game viewing, fishing, horseback riding, hiking, whitewater rafting and hot air ballooning. Let me tell you, this is an opportunity that you will not want to miss.

Currently 60% of the properties that have been sold are owned by residential buyers and 40% by investors. Only 4 hours from Johannesburg and 2 hours from Nelspruit this place is a gem, away from the clutter and rush of the city life!

IF THIS APPEALS TO YOU, CALL US YOU WON'T KNOW UNLESS YOU TRY!

Contact Wizard now for more information.

BUY to LET - MY PROPERTY - I think I know what its about??? PART 1

I bought a "BUY to LET" property and Im so excited as everyone says its fantastic....but I actually have no idea what it means and how to make money, or actually, even how much its costing me. HELP!!!!!!!

WELL WOULD YOU EAT THIS MONSTROSITY WITHOUT KNOWING WHAT IS IN IT?

---HELL NO!

DOES THIS SOUND FAMILIAR ?- Well stand in the queue my friends because BUY to LET can bite your butt as quickly as make you bucks. Buying property is serious business. It can and should be fun, but get advise from experts, and I mean lots of advise before you start spending your hard earned (or even well inherited money).

The salesman will tell you, "Listen buddy, you can get returns of 26% on this beauty. All you need is a cool flat, a bond (easy stuff) and the guys are queuing to rent in this area, it will cost you such a little and before you know it, the bucks will start rolling in. And, heres the best. If you dont make enough back, just sell it, youll make HUUUUUGE profits" - RIGHT!!!!!

So whats the real deal here, will BUY to LET work like this for me.

Understand the cost - Its not just the purchase price. (Say you buy for R 600,000.00 a NICE 2 bedroom apartment with a garage)

Firstly - You need to earn at least R 24,000.00 per month (More if you own other properties)

Purchase Price R 600,000.00 PLUS

Transfer and Bond Costs of R 19,496.00 (YES my friend their are transfer costs as well) PLUS

You need time and money to find the place and sign at attorneys and be off work and find a renting agent at a cost of...lets say R 7,500.00 PLUS

You better paint the place out and set it up for a tenant at a cost of...lets say R 5,000.00

NOT BAD for your first BUY to LET ...whats the TOTAL R 631,996.00 MONTHLY REPAYMENTS ABOUT R 6,000.00 per month on the bond, and the R 31,996.00 a great investment down payment from your savings.....LOOKING GOOD!!!!!!

Found a tenant at the going rental of R 4,000 per month. Signed them up for a year renewable annually at a 10% escalation. So when do I make my money???

You probably forgot the levy, but what the hell you will carry it for a while. Lets say the levy is R 480.00 per month.

You are now in for at least R 2480.00 per month for a long time. ITS TIME TO TAKE ACTION and make it work for you.

Turn this baby on its head and let it start working for you quickly!!!!!!!!!!

BUY TO LET - PART 2 to follow on Sunday....hang in there - LET ME SERVE YOU THE GOODIES!!!!!!

It should taste, feel and look great .

ABSA Loans winter special

Ladies and gentleman, after slating ABSA and giving them grief, I believe ABSA have come up with a great option and deal! Still pee'd off with them but, this will benefit those of you who have ABSA accounts so I'm going to BLOG it.

ABSA home loans are offering existing clients an awesome Winter special if you're looking to take a further advance on your existing ABSA home loan bond account. If you're interested come and check the ABSA home loans Winter special.

Minister of Housing???... Lindiwe Sisulu

Lindiwe Sisulu is our LADY! She is responsible for those R30 millions mansions and the township pandokkies...

Lindiwe is the Minister of high-end and low-end property and she wants the developers to continue to thrive so that they can continue with their work. More importantly it will assist her with the enormous backlog that the government has in providing the lower end housing for the masses in South Africa.

Her biggest issue at the moment is a new government objective (and hopefully an incentive as well) that compels all developers to include a 20 percent lower income housing component in their new developments.

She is definitely looking for a win win situation all round. This lady is a go getter and someone who's going to be making a difference in this country.

If you look at the St. Francis Bay example (if this had been in place then), there would not have been a sprawling shanty town but instead a proper housing environment for the workers in the area. THIS LADY MAKES BIG SENSE!!!

People without formal housing cannot be 'out of sight, out of mind'. Banks are granting bonds to those that earn R3000 a month, so if you can afford to pay that salary, then you will be assisting that person in getting the financing that they need. You could even arrange to pay a portion of that persons salary directly into their bond account to help cover their home-loan payments and in doing so, writing this of as a taxable expense... Some food or thought!

FACTS

Did you know that Lindiwe's dad, Walter Sisulu, was the first black estate agent in South Africa. Before the second world war, after studying at night school, he went to business and setup a small real estate agency that helped black people buy and sell property before the apartheid government limited those rights. So she is defiantly sitting in the right place and hopefully 'filling the shoes of her late great dad'.

When I grow up I want to be a bond originator...

Hello all you fellow bloggers and property GEEKS ;-)... I'm back and I'm pleased to announce that I've managed to get rid of Telkom or is it Hellkom I can't remember!

As promised though, we have our first featured article. WOOHOO! This article comes from a lady who wishes to stay anonymous, purely because she's a little shy and she's a new staff member of The Wizard Midrand Team. None the less, it's a brave start and the beginning of her new adventures as Anonymous "The Fairy" of the Wizard Team.

When I grow up I want to be a bond originator...

When I was just a wee little girl I had big aspirations of first becoming a doctor (until I realized how squeamish I was), then a veterinary doctor (also impossible – see note on doctor). I then went on a school day trip to the local fire station and decided that I wanted to be a firefighter. I was told by my father at the time “over my dead body”!

Enter high school, and I wondered aimlessly between classes of Economics and Accounting, Cooking and Geography (are you getting the idea of my lack of indecision?)

Having matriculated I literally fell into the finance world, having recognizing my talent and interest in it. I have worked in many fields from distribution, manufacture, entertainment and IT.

And suddenly today I find myself in the wonderful, pragmatic, inspiring and challenging industry of Bond Origination.

Knowing absolutely nothing about property (Yes we hire everyone ;-)), it has been a learning curve of note. This is a fast moving, high speed industry, with everyone working at frantic paces! But at the end of the day – there is nothing more satisfying than receiving those two golden words from the bank – BOND GRANTED!

Thanks Anonymous...Looking forward to your next post!

I've missed my BLOG!

I'm going to start this off by saying, Telkom you suck! We've now been without ADSL or internet access for a week. Today I found out that the copper cabling for half of South Africa's major ADSL network has been stolen whch of course leaves me without a BLOG. So here's a quick 10 minute update on what's up and what's forthcoming as soon as it's all online again.

1. I have not forgotten about the FREE WIZARD Hamper. I still have a couple left so those of you who have not yet subscribed to my monthly newsletter, now's your chance.

2. As for property news and developements it's all on the way, we have some great guest writers, real estate specialists and developers that have put some great content together for the BLOG, this will be going live as soon as I have my new Iburst connection, YOU HEAR THAT TELKOM! IBURST!... Sorry!

3. Wizard Midrand will be launching their new referral program soon! Keep yourself in touch!

Well that's it for now from the WizardMan.
Blog you soon!

Absa Home Loans - WAKE UP!

Well, S.A is fed up and this is why I've decided to write this article on behalf of real estate agents, bond originators, buyers and sellers in South Africa. I seriously hope that this article gets to the right people in that "dreaded" ABSA home loans department because the wheels are slowly starting to fall off that bus!

I can honestly say that in sunny South Africa, ABSA home loans are by far the worst home loans division...

According to ABSA they've put in a new system that were meant to increase turn around time for bond applications. They have appointed a new head for their Home Loans division in Jhb and apparently hired new call centre staff. Well all 3 of those area's have not improved, in fact, they've sunk to an all time low. I've received many complaints and it appears as though hundreds of applications are still pending with ABSA. Can anybody help us?

Their call centre staff are below the industry standard. To try find out how far your bond applications are is a nightmare. They're not able to us who's dealing with the bond application which obviously means there is a huge lack of training and understanding of how the business operates. They JUST don't have that "umph" to be able to take it to the next step.

ABSA please this is a shout out to you and your home loans division... Wake Up, smell the coffee and get cracking or Nedbank, Standard and FNB are going to leap way ahead of you!

WizardMan "Currently Pending"

FREE "Wizard Hamper" - First 10 Signups!

WOOHOO! It's the official launch of the South African property BLOG newsletter. I know what you're thinking. Another boring newsletter to add to my already massive collection of SPAM! You're WRONG I tell you! This newsletter, is going to be a newsletter with a difference. It's going to be a "informative", "exiting" and constantly changing monthly letter! With prizes, unreleased news and more...

It has taken me 3 months but it's here, and along the way I managed to find an awesome site, Zookoda, you guys ROCK! Do yourself a favour people and check it out! It's a great way to get a newsletter on your site and it's FULLY customizable.

Wizard Midrand have been kind enough to allow us to be the first to advertise their "NEW" referral program on our newsletter next month. It is open to "ANYONE", not just South Africans. There's only one catch, you need to subscribe!

As a little incentive, we've decided to offer the first 10 people who sign up to my newsletter a FREE "WIZARD HAMPER" valued at R150. I will be announcing the 10 lucky Bloggers next week.

SO WHAT YOU WAITING FOR?? SUBSCRIBE!

WizardMan Out!

P.S. It's the block just under "BLOG ARCHIVE" on the right side of the page!

Does your wife need larger breasts? Ask ABSA!

I went to LoanLink the other day for a good old fashioned home loan refresher course. They were giving us a breakdown of the different loans offered by the different banks , when I came across something called the Multiplan Loan from ABSA? Ever heard of it? Well neither had anybody else in the training room...

The Multiplan loan is a bond account with multiple loan accounts. It is a home loan option that allows you to split your mortgage up into separate accounts in the amounts of your choice, each with it's own repayment option and each with it's own interest rate! WHAT FOR?

Well lets say for arguments sake you had a loan account of R500 000.00. You need some change in your life, so you decide to split this loan account up into 3 segments, your home loan account, a breast enlargement account (for the wife of course) and a skiing account(for yourself while your wife recovers). What this means is that you have one loan account with two secondary accounts.

Each MultiPlan Secondary account can have its own:

* repayment term (not exceeding the term of the Primary account)
* statement
* interest rate options
* payment method for easy money management
* FlexiReserve facility.

At first I failed to see the advantages of this? What's the point? Why on earth would you want to split up your loan account when all mortgage originators and bank managers tell you the best way to get rid of debt is to combine it all into your bond account?

I thought about this for a while! Don't you think this is the perfect way to move money around? Think about it, 3 accounts, 3 different interest rates? mmmm I'll leave it at that!

FNB One Account - Is it the 1 Account?

The FNB One account. I'm sure you've all seen this on the news, on TV or even in the Cosmo( and no gents, I don't read the Cosmo)...

"What if you put your salary directly into your FNB home loan, over a couple of years it saves you thousands of rands AND IT DOES! You'll save a fortune on interest and if you're home loan was a bank account as well you'd have the best of both worlds."

The concept is incredible, it's what every home loan and financial advisor will suggest to you. Put your salary directly into your home loan so you can pay off that interest portion of your bond account. There's a catch to this One account though. It's a One account. What this means is that not only is it your FNB home loan but it's your FNB Home Loan account, your savings account, your credit card account and any other FNB account that you may have all joined into one.

The problem I have with this is how do you manage your money? How do you know how much you've spent on your credit card account, and how do you know if you've gone into your overdraft facility on your debit card? By consolidating all your accounts, are you giving FNB a chance to charge you more without you knowing? If you're not money savey, is this the option to go for, or are you going to get yourself further into debt?

If there are some FNB agents out there that read this BLOG, and there better be or I'm going to have to SPAM *@fnb.co.za ;-) please give us your comments, we're very interested to find out more about this...

For more information on the FNB One account speak to a consultant.

Architects and interior designers!

Six months down the line, I still don't have a flipping architect or an interior designer to take an interest in my home revamp project, why…? Well, seen as nobody wants to help and it's "property" related I'm going to BLOG it, TONIGHT!!!!!

I've mailed, i've emailed, phoned, skyped and left messages for various architects and designers but to no avail. Every amazing design I see in magazines, whose work I absolutely love, seems to have an architect who only deals in projects that are over R3 million or otherwise they're "too busy" to work with home alterations or they just don’t respond at all.

Has the South African property market BOOMED to such an extreme that there's too much work for architects? PEOPLE COME ON, STUDY ARCHITECTURE DAMMIT, and if you have a kid whose undecisive about what he wants to study, let him read this BLOG!

Interior designers seem to have the same problem, they keep postponing… what is going on in this industry. My home, needs to have a very experienced architect to assist with renovation plans (I don’t want to work with someone who has too little experience), surely there are many good architects looking for work, where are they, where are you?????

If anybody knows of any good architects please reply to this post!

LOVE
WizardMan's Mother!

Confucious Says: Leasehold's, Huh?

Confucious says: "Man who stand on toilet is high on pot!"

Well morning everyone, hope you're all up and about and loving life cause, "hey, hey, it's FRIDAY". Firstly let me just add that this weekend, is the weekend that both The Sharks and The Bulls kick some serious @$$! Secondly, let me add that this weekend is the weekend that Ferrari kicks some serious @$$!

Now that I have that out of the way I thought I'd give you confucious lesson number 3.

Leasehold Ownership (99 year lease)
Leasehold ownership as a form of property ownership was made available in 1978 to promote black home ownership. Further legislation passed in 1985 removed earlier limitations and has made this form of land tenure more attractive. Features of the 99 year lease include the following:

• The transferee of a 99 year leasehold right will, irrespective of how long the lease has already run, enjoy tenure of 99 years.


• Generally, costs are lower for this type of tenure than those applicable to freehold property


• No transfer duty and stamp duty is payable on 99 year leasehold transfers

Leasehold ownership transfers and related documentation are registered in the offices of the Registrar of Deeds.

National Credit Act - In a nutshell!

Reckless Credit
Reckless credit is prohibited under the NCA and is defined as lending money to customers without first:

• Ensuring they have enough income to pay it back
• Assessing a customer’s debt repayment history
• Ensuring a customer understands the costs, risks and obligations of the credit agreement



The Contract

• Documents should be written in plain understandable language so all customers can understand them (ahem!! have you ever understood these damn things)
• Customers will receive a preagreement quote that will list all costs when borrowing money. This quote is valid for a minimum of five days


Fee Structure
The NCA specifies that customers may be required to pay the following as part of the principal debt:

• An initiation fee, connection fees, levies or charges
• The cost of any extended warranty agreement
• Service fees, default and collection fees
• Taxes, licence or registration fees
• Credit insurance

The NCA also lays down maximum initiation and service fees and interest rates depending on the type of credit agreement.


Interest Rates and Changes
The NCA states that:

• A credit provider may charge a customer an interest rate that varies during the term of the agreement, but only if the variation is linked to a reference rate
• Customers should be notified in writing five days in advance of any changes to the interest rate or fees



Insurance Matters
Credit providers may require customers to take out credit life insurance for the duration of the credit agreement, however:

• The amount of insurance may not exceed the total outstanding debt owed to the credit provider under the agreement
• Insurance must not exceed the full replacement value of a property or the outstanding amount on a vehicle agreement
• Customers must be informed of their right to waive a proposed policy from the credit provider and provide a policy of their own choice
• Where the credit provider arranges insurance for a customer, the credit provider may not charge any additional amount over and above the actual cost of the insurance

Complaints

The National Consumer Tribunal was launched on 1 September 2006. It acts as an informal court to resolve problems that customers experience with credit transactions, credit bureaus and credit providers

Demographic Reporting
Credit providers will have to report to the National Credit Regulator the volume and type of credit extended. The NCA seeks to inform customers on these major issues:

• Quotations must disclose the full cost of the credit applied for including all fees
• Interest rate payments and the effect of not paying a deposit
• The cost of skipping payments and “free for the first six months” offers
• Penalties, hidden costs and implications of compound interest on long-term loans


Why does SA need the Act?
The NCA will ensure that:

• Credit providers lend money in a responsible manner
• Customers don’t borrow more than they can afford to repay
• If customers are over indebted they can apply for debt counselling
• Customers are protected from unfair discrimination
(Sounds like an addiction to me ;-))

Credit Bureau Information
Credit providers must:

• Ensure that the information submitted is accurate, up to date, relevant, complete, valid and not duplicated
• Give the customer 20 business days’ notice before they submit their name to a Bureau

The Bureau must:

• Ensure that the information they hold is accurate, up to date and remains confidential and secure

Any person may question the validity or accuracy of their credit record


Can customers afford the loan?

• Credit providers are obliged to make sure customers can afford to repay their debt
• Customers will need to provide details on income and expenses when applying for credit


Advertising and marketing
The NCA aims to stop misleading or deceptive advertising:

• Words like “no credit checks required”, “free credit” and “guaranteed loans” cannot be used (ladies and gents best you check your websites)
• Negative option marketing where the credit provider enters into a credit agreement is not allowed without a customer’s express consent


No more Pushy Salesmen
The NCA specifically prohibits credit providers from:

• Harassing customers to apply for credit or to enter into a credit agreement
• Increasing the limits on a customer’s credit card, overdraft or any other
credit facility without their consent


Spousal Consent
Married in community of property?

The NCA requires all customers applying for credit to obtain their spouse’s consent.

Thank you to STANDARD BANK for providing us with this information!

The Department of Trade and Industry have now formed a team of credit regulators to regulate the new Credit Act. For more information go and visit their site at http://www.ncr.org.za.

Confucious Says: Immovable Who?

Confucious says "War doesn't determine who's right. War determines who's left."

Well here's part two! I know they're a little technical but hopefully by the end of my "EDUCATIONAL SERIES" you'll have no problem understanding these!

Who would've thought that something as easy as "immovable property" had a definition the size of half a wikipedia.

Immovable Property

Land and every real right in land or minerals (other than any right under a bond) which is registrable in any office in the republic user for the registration of title to land or the right to mine (AEA), 'Immovable Property' includes:

• Any unit as defined in Section 1 of the Section Titles Act of 1971 and any proposed unit;


• Any right to claim transfer of immovable property;


• Any undivided share in immovable property;


• Any interest in immovable property, other than a right or interest registered or capable of being registered under the Mining Titles Registration Act of 1967;


• Any share in a private company referred to in the Companies Act of 1973 the whole or major portion of which consists of immovable property;


• Any share in a share block company as defined in Section 1 of the Share Blocks Control Act of 1980, and any proposed share;


• An interest of a member of a close corporation, of which the assets consist wholly or mainly of immovable property.

Confucious Says: Freehold is what?!?

Confucious Says "Man who walk behind car will get exhausted, but man who walk in front of car, will get tired!"

When it comes to the home loan jargon, there's loads of it. I'll be honest I still have to ask old Storm the "Pixie" next to me every 5 seconds to tell me what an AIP is again. But fear not my friends!! The WizardMan has decided to make it "EDUCATIONAL WEEK"...
I'm going to post a couple of mortgage terms each day for everyone to save and bookmark for future reference should you ever need it!

FREEHOLD TITLE
Freehold Title is the most common and basic form of property ownership and provides for:

• The ownership of a piece of immovable property, registered in a deeds registry, by an individual/individuals or legal entity, eg cc's, trusts and companies


• The right of ownership of immovable property to be transferred from one person to another; or from one legal entity to another, or from a person to a legal entity and visa versa;


• The purchaser of a freehold property to obtain a legal document (normally a title deed) which details the rights and obligations of the owner concerning the use, maintenance and development of the land (property acquired under freehold title implies ownership of the specified land and any improvements erected thereon);


• Deeds offices not to allow the transfer of property from one party to another without the production of a certificate, which confirms that all the amounts due to the local authority and Receiver of Revenue for transfer duty and rates have been paid.