New SARS updates

Is your house currently held in a Company, Close Corporation or Trust? Then it could be very beneficial to you to be aware of the current “SARS given” opportunity to SAVE a lot of money if you would like to transfer it into you own name?

The Taxation Laws Amendment Act, promulgated at the end of September 2009 gives you until the end of 2011 to transfer residential property that you use mainly for residential purposes into your own name free of transfer duty, capital gains tax(CGT), secondary tax on companies (STC).
This saving will be available to you if:

you (or you and your spouse) are the holder/s of all the interest in the Company or Close Corporation that owns the residential home in which you are ordinarily resident; or,
you (or you and your spouse) transferred such residential property into a Trust and financed the Trust`s acquisition of the property or serviced the mortgage loan repayments, if the property is bonded; provided

you (or you and your spouse) have ordinarily resided in the home and have used it for normal domestic purposes (and not merely as holiday house) since 11 February 2009; and
you transfer ownership in the property into your name, or in both you and your spouse’s names jointly before 31 December 2011.

Homeowners Insurance

We know that home insurance is a grudge purchase, so we have partnered with the leading Insurers to save you some money and make that monthly payment an easier pill to swallow.

As South Africans, we need to protect ourselves against theft and property damage, which means that partnering with the right company is key! Our partners are a mix of Direct and Traditional Broker insurers ensuring that you are provided with a choice between two different ways of doing business.

Homeowners insurance, is in fact the correct term for this product, which falls under the category of life cover. Homeowners insurance is also referred to a bond cover, bond insurance, property insurance, house cover and bond protector plans.

To give you a brief understanding of what this is, it's life cover for your bond. This cover incorporates various different insurance policies, some protecting you from personal cover such as ill health and loss of employment, other plans cover you incase of damages incurred due to lighting or floods.

No one likes to think that they might loose their home if they lost their employment or good health. The harsh reality is exactly that.

We offer over 7 independent quotes from different insurance brokers.
We also have contracts directly with ooba for the cheapest insurance on ooba buildings protector plan and ooba bond protector plan. For more information on these products please contact us directly on +27 12 341 2223.

OR GET A HOMEOWNERS QUOTE NOW:

What are the banks doing?

OK people it's time for me to freak the @#$% out again!!!

I've been trying to figure out why we can work out affordability ANYMORE. By we, I mean bond originators in South Africa. I put these applications together work everything out according to plan, submit the application and we get declined on affordability (WHEN ON OUR SIDE, affordability is so evident you could by 3 places on the same salary).

BUT WAIT, what the banks are now doing is scoring you according to what rate they would give you. Rates at the moment, PRIME and PRIME PLUS!

So the point of this blog post is twofold:

1. For those of you applying for home loans ensure that you factor in at least a PRIME +1% into your affordability to ensure the accuracy of your affordability and to ensure your SANITY :)
2. Banks - Nedbank especially, please can you advise bond originators and the public when you decide to change scoring policies so that we all know what to do when applying for a bond.

We're not here to trick the banks we're here to work together with you!

Wizardman OUT!

ABSA - No more 100% bonds! EVER!

An update straight from the horses mouth!

“We explored whether ABSA home loans are in the near future going to introduce a 100% LTV offering to the market and improve the current 70% LTV offering to non-ABSA customers. From the feed-back received from the ABSA home loans Head Office team yesterday, it seems unlikely that in the short-term ABSA are going to move on their LTV’s in the aforementioned categories.

ABSA home loans also confirmed that their direct LTV offering definitely did not include 100% loans. ABSA only offer 100% loans to qualifying applicants for their My Home product (up to 110% risk) and to qualified purchasers of their pre-PIP’s (properties in possession) and PIP’s. These 100% loans are available through all channels, including origination.

WizardMan Out!

"Nedback" on track

Ladies and gentleman!

What better way to start a magnificent Friday then to give you the news that Nedbank is offering 100% home loans again!

This is a briliant and positive step in the right direction, meaning other banks will follow suit shortly.

From my previous post we know that Standard Bank home loans are offering 100% loan although not via the bond originatio channel. Nedbank home loans on the other hand have come to the party and realised that more than 70% of their home loans business is from bond channels so why cut them off!

Read the memo from Nedbank below:
Please note that Building Loans will be treated like First Loans, and where a “Building Loan” Further Loan is involved it will be treated as a Further Loan.

Kindly note that 100% LTV offerings are dependent on successful confirmation of a favourable client risk profile. Should a client profile not meet the Bank’s minimum risk criteria, the Bank will reserve the right to decline or issue a lower than 100% LTV.

All changes applicable will relate to residential home loans submitted to Nedbank as of the 29th of September 2009.

Home Loan applications that are currently in the Bank’s system will be processed as per previously communicated LTV rules.

I would kindly request your assistance in distributing the communication to the respective sales channels including aggregation businesses and associated agents. Please direct all operational queries to your local Nedbank sales representative for immediate assistance.

WizardMan Out!

Standard Bank 100% home loan offerings

As you know Std Bank home loans have recently released their 100% home loan service offering to clients. Their marketing TOOL - only 100% home loans offered to clients that go directly to Std Bank and not via a bond originator.

Now obviously this is a little thorn in the side to most of the bond originators out there, BUT, what do you still have to your advantage?

1. Bond originators offer great service.
2. We do all the dirty work for you including, filling in forms, submitting to ALL 4 banks and following up on all the deals.

So, does this really affect your business if you're a bond originator? NO. And it shouldn't. Let's keep the flag flying high and show the banks why they need us.

Std Bank Criteria!!!

Standard Bank home loans has recently increased its risk acceptance rate in its Home Loan and Credit Card divisions. The changes made to Standard Bank’s risk appetite have been specifically designed to benefit first–time entrants into the housing and general credit markets.

Peter Schlebusch, Chief Executive, Personal and Business Banking, Standard Bank South Africa, says: “It is important that we support and provide access to finance to the lower end of the economic spectrum. People in this sector have been hardest hit by higher inflation, job losses and the general slowdown in the economy. Standard Bank is committed to providing access to finance and financial services to the low income market, while continuing to focus on prudent risk, capital and liquidity management.”

The following adjustments have been made:
Jump Start bonds (first–time home owners) up to R1m home loans and who are using this as their primary residence are now able to qualify for a cost–inclusive 104% LTV (loan–to–value) loan.

Affordable housing: Standard Bank home loans is now allowing LTVs of 100% (up from 90–95%).
Standard Bank has upwardly revised its LTVs on new home loans. Customers using internal Standard Bank channels with home loans of under R1.5m can qualify for LTVs of 100% (up from 90–95%). Houses of R1.5m–R2.5m will however still require a 10% deposit, and >R2.5m home loans will still require a 20% deposit.

Standard Bank has started accepting low–risk non–cheque Standard Bank customers and low–risk non–Standard Bank customers for home loans.

With credit cards, Standard Bank home loans is increasing its risk appetite by raising the “acceptable” bad debt ratio by 3% on new business written in a select entry–level segment of the portfolio.
Sim Tshabalala, Chief Executive of Standard Bank in South Africa, says: “We believe that an economic recovery will be slow but we see medium term improvement among households, as affordability improves on the back of lower interest rates. We have taken proactive steps to capitalise on this improvement.”

Standard Bank home loans has accepted the tender proposals for origination business from BetterBond, Bond Choice and Multinet, all three of which commenced submitting home loan applications from 24 August 2009. Standard Bank believes the new rates negotiated with mortgage originators will allow for a sustainable long term business model.

Absa 110% home loans

The doors are now opening.

Absa home loans this morning announced that 110% home loans will be offered to lower income earners. This is a big bold move that seems to have been started by Std Bank home loans.

According to the Business Day:

MORTGAGES of 110% are now available to low income earners, ABSA said today as it adjusted its lending criteria.

“Absa has become the first bank to provide relief to low income earners by offering 110% bonds with a monthly income up of to R11,000,” the bank said in a statement.

“The turn in the economic cycle is becoming evident and as such we need to review our customer offerings.

IS THIS THE TURN OF EVENTS WE'RE WAITING FOR?

Standard Bank Home Loans - THEY'RE BACK!

Well, this post is way overdue but I've had alot of thinking and reading to do, so better late than never. You might have heard the latest news and updates in the home loan world, well, if you haven't here it is!!!!

THE MEN IN BLUE ARE BACK!

Standard Bank home loans have opened there doors to bond originators! Not only have they opened their doors but they've allowed non Standard Bank clients to apply to.

Current product list that's been opened to bond originators:

1. 100% home loans up to R400 000
2. 90% home loans for the rest

It's a nice warm welcome, and with talk of 100% home loans being opened up too, let's hope it's a MOVE in the right direction for all the banks and the future of the mortgage market in South Africa.

Need assistance with your Standard Bank home loan today? CALL us 012 341 2223!!!

18 reasons why homebuyers should use a mortgage originator

In this market, it is critical that you use the services of an originator who knows how to position your bond for optimal success. Wizard has a wealth of experience and industry knowledge to enable us to find the right home for you.

So with this been said :) here it comes...

1. Secure approvals: better chance of approval by submitting to multiple lenders (ABSA, Nedbank, FNB, Sanlam, Ithala Bank, Blue Financial Services and The National Housing Finance Corporation)
2. Get the system to work for you: take advantage of the fact that each bank has different
credit criteria, deposit requirements, documentation requirements, interest rates and
turn-around times
3. Expert positioning: prepare, motivate and package the application for the best chance of approval
4. Best interest rates: banks compete for every loan application ensuring you get the best deal
5. Simultaneous submission: direct interface to lenders systems allowing simultaneous submission of applications to multiple lenders
6. No cost: it’s a free service to the homebuyer
7. No obligation: no obligation to accept any loan sourced
8. 7 years Expertise: home finance experts have intimate knowledge of the various banks’ products, credit criteria, documentation requirements and interest rates
9. Problem escalation: dedicated senior personnel escalate any problem applications ensuring a better chance of approval
10. Hassle free: one generic application form for all lenders
11. Cost savings: advice on the best way to structure the loan to reduce the total cost
12. Convenient: originator completes the application form and does all the legwork
13. Faster approvals: dedicated personnel guide the application quickly through the bank’s approval process, actively chasing up progress
14. Independent advice: most appropriate home loan options from all lenders
15. Dedicated communication: one point of regular feedback on the application status
for all lenders
16. Best service: professional and personalised service either face-to-face,
telephonic or online
17. Commitment: home finance experts are committed to securing your loan
18. Homebuyers all agree: over 70% of all new home loans are secured using mortgage originators

New Website - Wizard Midrand Home Loans

Well... I figured since everyone here is an avid fan of the Wizard Home Loans and SA property sites :) that I'd give you the readers the first chance to comment, bitch, moan, groan and praise on the new look and feel of our website.

Currently i've got a BETA version of the site up and running and would really really love some critisicm and feedback from all of you.

Let me know what you think.
http://digitalbone.co.za/wizard-test/index.html

Thanks in advance, if anyone really cares ;-)

Labour Relations Act - Changing SA Business Forver

The new labour relations act is coming in 2010.

After reading this article on the Standard Bank Espresso Magazine newsletter, I was almost excited to see that South African business practice and business in general is set to change forever.

It's time to sift out the rubbish in South Africa, and let real businesses start moving forward. There will be no more getting away with selling bad products to the South African consumers. No more fraudulent insurance policies and bond originators charging exorbitant fee's. This is a major step forward.

For any small / medium or large business owner, you'll want to read this article.

It's official: The way that business is done in South Africa will fundamentally change from October 2010 when the Consumer Protection Act kicks in. For business owners, it is the most far-reaching law since the Labour Relations Act.

http://www.standardbank.co.za/site/business_banking/espresso/Clickthroughsissue8/MainNews_01_pg1.html

Interest rates remain unchanged

News Flash: Michael Jackson passed away last night! A sad time in the history of music! A man light years ahead of his time, and the most influencial pop musician of ALL time. His music will sorely be missed by all, but a legacy will always remain!

Tito Mboweni's decision yesterday to keep rates unchanged has shocked some, but with inflation levels staying at around the 8% mark, it's no wonder.

After dropping the interest rate more than 5 times this year already, and inflationary levels not dropping at quite the speed the reserve bank were hoping, Tito's decision remains a solid one.

There's loads of speculation out there with talks about rates going back up and people needing to fix rates now, but with GLOBAL economies sitting at the levels they're currently sitting at, it's not possible. If anything I believe we'll see a another drop in the next month or two and then we'll stabilize!

Cleaning up your credit record

When working in the Home Loan business and seeing how people fall into debt you enter into a world were people are drowning and we are constantly in a field that needs advise. Don't wait until its too late to sort out a potential debt problem. Do a credit check. Clean up your credit record. Its not something to be ashamed of, but it is something that should be managed sooner, rather than later, when the pressures have reached insurmountable proportions.

By negotiating lower interest rates and waived late fees, you can often arrange more affordable payments and shorter payoff periods. You can also consolidate your debts into one convenient monthly deposit that will disburse directly to your creditors.

Once you acknowledge your debt and get your payment plan into place, its amazing how quickly your stress levels drop. Your creditors are more likely to be understanding and accept that they will be paid, and the pressure on you is reduced to manageable proportions.

Labeling the cause of your debt overcomes the hurdle of denial and sets the course clear to financial rehabilitation.

Few things in life cause more tension than a debt crisis. Do not tackle this alone. Ask those closest to you to help see you through this difficult time.

Can you deal with bad debt?

If you need a debt counselor use a reputable organisation and check what it is going to cost before you sign up, and in many instances your bank can help you.

Will South Africa get another Rate Drop

So there's alot of talk and speculation again about another interest rate drop....

24 out of 26 economists in a Reuters poll last week predicted that the MPC, which has seven members, will lower the Bank’s key repo rate by half a percentage point to 7%. That would bring the cumulative reduction over the past seven months to five percentage points, taking prime lending rates back to the level they were at in 2003.

Electricity utility Eskom is asking for a 34% tariff annual increase.
So while producer inflation has braked sharply, consumer prices remain high and central bank governor Tito Mboweni warned after last month's meeting the policy committee was unlikely to go for more big cuts.

Powerful trade unions, close allies of the ANC, have demanded more action from the Reserve Bank and government to save jobs and propel the economy out of recession.

For additional articles relating to the potential rate cut:

http://www.businessday.co.za/articles/Content.aspx?id=73758

http://www.fin24.com/articles/default/display_article.aspx?ArticleId=1518-25_2531251

http://www.moneyweb.co.za/mw/view/mw/en/page87?oid=298839&sn=Detail

The Zuma Five - Go Go Go Mr President we love your song now lets see the dancesteps

Mr President, when I listened to your speech, I was impressed!

I have never felt more - that i want to believe what you say you will deliver.

I will stand by you and our country as we endeavour to claim our rightful place as proud South Africans.

bayete! I salute you as we create jobs, cut crime and create the rightful housing for all.

I see your hand in the strengthening of the Rand against the Dollar. The lowering of interest rates - which you COULD GIVE US MORE OF.

I know you have many masks that you must wear and I feel concern on the checkered past, but you do represent a very well needed change and I look forward to your bulldog approach when you take on crime!

I hope to see our banks lending to those needing credit as we weather the credit crises and I hope your intervention prevents them from stepping into a cocoon of protectionism as we need them to assist the people on obtaining homes and the financing thereof. The strength of using the reserve bank to lower our rates will force the banks to follow suite and give the man in the street the cash to keep our economy afloat, active and rebounding against the world storm.

bayete! You're such a THRILLER!!

General Motors Bankruptcy - GM Confidence in SA Market

This week, General Motors announced that it would continue the rebuilding of its U.S. operations under a court supervised process. This is a progressive step which will position the company to succeed in an increasingly competitive and challenging U.S. automotive industry.

GM South Africa is not part of this filing in the U.S. and will not be affected by the measures announced. We are a self-sustaining operation and as such will continue to operate as normal, drawing on GM’s global resources for the same great product portfolio that has helped us become one of the leading automotive companies in Southern Africa today.

GM South Africa and our dealer partners will continue to provide full sales and after sales backing for all our vehicles including honouring all warranties, service and maintenance plans which we believe are the best in the industry. During the past four years alone, together with our dealer network, we have invested R4 billion in our joint operations to ensure that General Motors’ customers in Southern Africa receive the best products and services available.

More recently, we inaugurated a new R150 million Vehicle Conversion and Distribution Centre in Port Elizabeth, and we will soon break ground on our all new R250 million Pan-African Service Parts Distribution Centre. We are also happy to say that we have now received the first shipment of the highly anticipated Chevrolet Cruze so that our South African Engineering Centre can begin local validation testing prior to the start of sale later this year. These are simply a few tangible examples of our commitment to providing our customers in Southern Africa with the world class level of service you deserve.

We are proud of the General Motors (GMSA) long standing history in South Africa dating back to 1926, and we appreciate the loyalty of each and every one of our customers. We take our commitment to you very seriously, and look forward to building a bright future in this great country together.

This article was taken from: http://www.gmtotalconfidence.co.za/usreinvention/

Absa Affordable Housing Enhancements

Absa Affordable Housing Enhancements

In light of changing market conditions, particularly at the lower end of the housing
Market, Absa Home Loans have taken a strategic decision to increase the income levels
Of the MyHome product and Affordable Housing segment.

The product offered within this segment

A: Income less than and equal to R11000 (Gross Joint Household Monthly
Income): Absa MyHome product

- Loans up to 110% Loan To Value LTV and Maximum 80% Risk to Value (RTV)
- Borrower Education for all customers with loans in excess of 80% of the purchase price.
- Repayment term up to 30 years (default if not specified; i.e. 20 years)
- Credit Life Policy – Home Loans Protector Plan
- 30% Collateral Replacement Indemnity Scheme (CRIS)

B: Income between R11 000 and R15 000 (Gross Joint Household Monthly Income):
Absa Affordable Housing
- The business as usual home loan rules will apply


The Collateral Replacement Indemnity Scheme (CRIS)

In order to mitigate the risk between 80% to 110% customers must either provide a cash deposit, Employer guarantee, government guarantee, Pension Supported Home Loan or other acceptable Guarantees.

If the customers cannot provide collateral, Absa will provide a CRIS ( Collateral Replacement Indemnity Scheme) guarantee from the Home Loan Guarantee Company (HLGC). CRIS is effectively a bad debt insurance product. HLGC will cover the guarantee amount Agreed upon, to reduce the potential shortfall amount recovered after sale in execution of The property.

a. CRIS Rules and Requirements:
- The insurance cover period is 5 years from the date of registration and this may be renewed.
- All customers with CRIS must attend Borrower Education
- HLGC will provide a CRIS guarantee of up to 30% (80% RTV to 110% LTV)
- New CRIS loan will be administered by the Home Loan Administration Centre (HLAC)
- Any accounts in arrears will be administered by Secured Collections.

Please Note: Absa home loans systems will allow a maximum of 110% to Purchase Price and Loan to Valuation without you having to capture an employer or personal guarantee for all
Applications where the Total Household Gross Monthly income is between R1500 and R11 000
And the customer does not have a deposit or other types of collateral security.

Lets Decline Bonds but Up Admin Fees!

Go Standard Bank. At the moment, the top bank amongst PEOPLE of South Africa and Bond Originators!

Not sure if any of you follow property news but if you read this article last week:

http://www.realestateweb.co.za/realestateweb/view/realestateweb/en/page196?oid=40338&sn=Detail

READ IT & then I'd like you to read the below:

Quoted from: Mr Charles Black an independent International financial specialist... and a Standard Bank multiple mortgage, savings and fixed deposit client.

Well this smacks of greedy banking and badly managed banking practice. It simply seems that unless you have the banks insurance you will pay more, smells of forcing people to use their insurance and removing the fairness practice of freedom of choice. Hit the free hardest, in their pockets. My insurance is at least 20% cheaper than that offered by the banks, now I need to switch this back to them, and save less and still pay higher monthly fees.

With regards internal costs why not do some good and save paper and the trees by being the first bank to go paperless and have statements available in electronic format and only printable at an ATM at the clients costs. That's good banking.

The comments of protecting its deposit holders scares me, try deposit cash, then you will see what it costs the deposit holder. I think this is pointing at similar issue to elsewhere in the world. Is Standard Bank running out of cash? Is their a liquidity problem looming and a bailout looming. Is the loan versus deposit ratio out of kilter and the result being that more deposits are required. Is the man in the street being asked to pay more to cover rising defaults and the costs thereof.

Simply put I think Standard Bank needs to be very clear on the message they put out to the person who banks with them. As a client I expect service and if I don't get what I want I should change banks. That's what I intend to do. After all, its our money, that we have invested with them, that they say they want to protect, but it is the same "we" who are being penalised by increased costs, lack of lending facilities and who risk being at the banks mercy". Standard bank needs a wake up call.

Self Employed? Wait 2 years before you get a mortgage!

It's a HOT topic!

(Please take a few of these comments with a pinch of salt, I have been slightly sarcastic with certain comments)

Something that I've been wanting to let out for a long time!

When governments /banks & countries are in a recession, what is it they always ask of their citizens?

What is the biggest financial sector at the moment, that governments are trying to punt?

I'LL TELL YOU!

Self Employed Individuals.

The banks and governments are pumping millions and millions of rands into "small business start ups"!

Why? Well, small business start ups bring "entrepreneurship" and ideas to a stagnant and declining economy. It's a sure way to make sure that the countries, youth and ideas don't fall along the wayside and it's a good way to keep stimulating the economy especially when big giants start collapsing (http://news.bbc.co.uk/2/hi/business/7615974.stm).

So where the hell am I going with this, you may be asking yourself?

Well I just so happen to by the Entrepreneur magazine every month, it happens to be the best business magazine I've ever read locally and abroad, and there's talk of billions and billions of rands available in small to medium business start up funding! GREAT! I LOVE IT! Means more money gets put into the economy and the fact that alot of this funding is coming from the banks is even better, they know what they're talking about.

Here's what pisses me off!

If you're an ABSA home loan clients don't even think of applying for a home loan unless your company has been running for 3 years!

If you're an FNB / Nedbank or Std client don't even think of applying for a home loan unless your company has been running for 2 years!

BETTER YET, Nedbank and Std bank won't accept self employed people unless you bank with them.

What I love most!!!!!! If you earn cash, even if you declare 100% of your cash and deposit 100% of your cash into your account and pay taxes on it, they still won't give you a bond!

This means that unless your company has been running for a full 2 years & you meet the following requirements, YOUR MORTGAGE APPLICATION will be declined:

1. 2 full years of audited financials (These must matchup 100% with your business bank account transactions)

2. 12 months bank statements for your personal account

3. 6 months bank statements for your business account

4. A letter of income that states what you earn every month (MUST REFLECT IN YOUR PERSONAL BANK ACCOUNT AS A SALARY)

5. IT34 that must prove the amount of tax you pay every year

EASY HUH!

So here's the summary of what Self Employed individuals can and can't do!

- Never ever run a cash business (pilates, gyms, private tutoring, schooling etc etc), the banks want to make money of every transaction you do, heaven for bid you should save R5.

- Make sure everything you earn is declared (or not visible)

- Make sure you pay accounts to do your financials and books (even if you're not making that much money)

- Pay your TAXES!!!!!!!!!!!!!!

REMEMBER: THE COUNTRY NEEDS SELF EMPLOYED PEOPLE, THEY JUST DON'T WANT TO HAVE A HOME!

Absa home loans, Nedbank home loans, FNB home loans and Std Bank home loans!

This letter is to you!!!!

WAKE UP BOYS

Repo Rate

So, even with all these public holiday's we've had this month, the government still managed to find some time to give us a little break in home loan repayments and save us all a little money.

Tito Mboweni and the South African reserve bank decided to drop the repo rate by 100 basis points. Thanks to Tito once again and thanks to the SA government.

So far, Zuma, you've got my first 2 thumbs up ;-)

Happy April everyone. Enjoy the public holiday.

Interest Rate is now 12%

Nedbank Properties in Possession! Special Offering!

NEDBANK OWNED PROPERTIES

CREDIT OFFERING
April 2009

Nedbank Home Loans recently introduced an additional value proposition to the market whereby the Bank will assist and enable the successful conclusion of PIP (Properties in Possession) sales through a centralised call centre.
In addition to the communication dated the 2nd of April 2009 it is hereby confirmed that Nedbank Home Loans will be offering a 95% loan offering to qualified buyers as of the 20th of April 2009.

PROCESS GUIDELINES & TERMS OF BUSINESS:

Please note that the offering does not supersede existing credit rules and process guidelines and will only be applicable to qualified buyers of Nedbank Owned Properties which can be obtained at www.nedbank.co.za.

Vacant land is included as part of the offering for qualifying buyers.

If this is something that interests you, please feel free to contact Wizzard home loans today!

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.

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!!

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?

SOMETHINGS WRONG HERE MAN!

Readers - What are you thoughts????

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!

Good news again - I'm looking forward to it!

Well, it seems as though the good news just keeps on coming. Lots of speculation about the interest rates dropping tomorrow by 100 basis points.

I know he originally asked for 200 basis points cut 2 weeks ago, so 100 basis points looks like it's happening for sure.

Nice relief for the home owners.

For those of you that didn't know, Woolworths dropped their food prices too on over 200 products making them a leader in the industry. Could this be a trend in the South African market...

Are the government and other institutions getting together to assist South Africans with their daily expenses.

Keep it coming South Africa! We need it and we'll love you for it!

South African Budget Speech 2009 /2010 - Summary - Overview

Trevor Manuel announced the budget speech yesterday. With his "budget policy in the time of crisis", Trevor Manuel yesterday presented a brand new lease on life view of the economic crisis that's hit SA, moving away from his usual conservative views and opening up with some mind blowing numbers and figures to help stimulate our economy for 2009 / 2010.

So without further ado, i give you the summary / overview of the 2009/2010 budget speech. We will later today post the entire breakdown of the budget.

Tax breaks:

• tax payers will pay R13.6 billion less in income tax


• individuals under 65 who earn less than R54 200 per year will pay no tax


• those over 65 who earn less than R84 200 will pay no tax

Cough up for your cigarettes:

• a packet of cigarettes now cost 88 cents more


• the price of 750ml bottle of spirits goes up by R3, 21


• a 340ml can of beer now sets drinkers back a further 7 cents

Grants grow by R50:

• from April, the old-age, disability and care dependency grants will rise by R50 a month


• the retirement age for men currently at 63, is in the process of being reduced to 60 by 2010 to be on a par with that for women

Petrol pain

• fuel levies will go up on April 1 by 23 cents litre for petrol and 24 cents a litre for diesel


• the road accident fund levy will go up by 17.5 cents a litre


• the total increase will be just over 40 cents a litre

WHERE YOUR MONEY WILL GO

Justice and safety

• the fight against crime will receive a R5.4 billion boost this year, bringing total spending on courts, prisons and the police in 2009/2010 to R101 billion


• R3 billion will be spent on upgrading the it networks in the criminal justice system

Schools, roads and clinics

• R24.8 billion to provinces to increase services, mainly for health and education


• a further R4billion for the school nutrition programme


• R4.1 billion for provincial infrastructure especially, schools, roads and clinics

Service delivery and job creation

• free basic services; R600 million for municipalities to extend free basic services


• to create jobs and accommodate higher costs for skills and materials, spending on infrastructure will rise from an estimated R690 billion to R787 billion most of it for municipalities, provinces and parastatals

Better health care

• R932 million for the treatment and prevention of AIDS


• an extra R1.8 billion for three new vaccines to help reduce infant death


• R728 million for the hospital revitalisation programme - upgrades and construction of 31 hospitals nationwide

Supporting children

• from April, the foster care grant will increase to R680


• last month the R240 child support grant was extended to 15 year olds

2010 fifa world cup

• an extra R463 million to cover cost increases and pay for better project management of the stadiums being built


• R508 million in 2009/2010 and R210 million in 2010/2011 to help host cities prepare


• R11.9 billion in the next 3 years for public transport

Powering eskom

• R1 billion to manage power consumption


• eskoms R60 billion government loan to be repaid over 30 years. the power utility which got R10 billion in last years budget gets a further R30 billion in 2009/2010 and R20 billion in 2010/2011

Poverty relief

• the expanded public network programme which has run for four years will be extended by another 5 with the provision for jobs that will keep people employed for longer


• R1.8 billion for rural development over the next 3 years

Thanks Trevor

References: The Star & The Pretoria News

Bite the Dog - Dubai Mortgages and Rental Finance

So it seems like the guys in Dubai and the UAE are coming up with some exciting business options.

The rental market is making some great adjustments in the UAE and now you can get rental finance for 6 months, 1 year and you can pay your rent with one or two cheques, negotiate lower rents even if the landlord wants 12 cheques and manage your cash flow. Independent Finance are the guys offering this and its a real win as they have about 8 options available from interest based to fee based deals.

So be smart, get credit managed and control that crazy spending anduse your money wizely.

Mortgages, loan to value of up to 85%, interest rates of 7.8% and some great deals available now if you are shopping in the UAE.

February 2009 Interest Rate Drop!! woohoo

Ladies and gentleman... Some good news.




The interest rate has officially dropped 1%.

South Africa's new interest rate 14%.

Thanks Tito, you're a star!






Let the trend begin and let the houses start selling again!

The Independent Alt Ateam

Create your own FACEinHOLE

The ideal mortgage applicant

With Wizard Midrand's founding member now out in Dubai, coaching the banks and teaching mortgage companies the ins and outs of bond applications.... he's been really busy! In fact so busy that we haven't had an article from him in ages....

Well, we managed to get hold of Chris Green, and we asked him one simple question:

What are the criteria for an ideal mortgage applicant at the current time in Dubai?

There are two sides to each application for the ideal mortgage applicant to be relevant.

One being the person (Pre approval) and the second being the property (valuation). Once these two sides are dealt with separately and equally, they can then be joined at the hip to become the perfect mortgage applicant.

So starting with the individual, when a pre-approval is done by any finance house, the basis is on the credibility of the person wanting finance and the perceived credibility as seen by credit managers within the banks. With lenders appetite for risk being extremely sensitive and probably at an all time low, all of them are looking for “Mr. Perfect”.

So the profile of “Mr. Perfect” is typically a person who is buying to live in and not to let out. They are seen as a person who is here to stay. They must be a salaried individual or couple who earn a fairly reasonable income and that income must be deposited into the same bank account each month and they must have one hundred percent correlating salary pay slips.

The company or industry that they work for must not only be well established (at least 2 years in business) but ideally be seen as a non-risk industry because each lender has certain industry criteria that they feel is a risk to their lending policies. Credit cards, car finance and other finance vehicles must be paid on time every month and there must be no late payments whatsoever. That is sure guarantee to have a mortgage decline. Pay on time always.

Unusual deposits and bank transactions attract scrutiny by credit managers and explanations are needed for all of these. Letters of reference from other banks that the client deals with are always a bonus. It is also assists that when a person is from another country and can provide an up to date credit report from that country, it gives the credit managers a decent birds eye view and objective understanding of the prospective client.

Lastly having a fixed deposit with some money in at the lending bank is a definite bonus as this will affect your credit status to the good and you can earn about 6.5%.

The ideal property is one that is completed and registered in the lands department. Any variation of this, makes the second part so much more difficult as you are then totally reliant upon the lenders criteria of developers and their famous developers lists. Because of these lists the clients are often limited to who will provide finance and also what loan to value they will offer.

Once these two are married, you have the ideal mortgage and then to get the better rates it often comes down to client standing in the bank and how much deposit he can put down to bring his loan to value down.

Currently, we are seeing one in five applicants who are matching this criteria .