South African Banks - World's Best

South African Banks Who the hell do they think they are?
What is this nonsense about a new National Credit Act?
Why the hell are banks no granting bonds anymore?

Are these questions similar to the headlines you've been reading the last couple of months on most of South Africa's blogs, websites and newspapers?

Well, let me clarify something for all of us today!
If it wasn't for the credit lending practices that we've put into place. If it wasn't for South African banks putting tightened grips on lenders and it wasn't for South African banks who decided not to sell off bad debt and try make money from it, we'd be in the same boat that most of America's banks and lenders are finding themselves in.... More debt than they can handle and liquidation.

So this article goes out to the South African Government and Banking Institutions for keeping their companies afloat and in turn making South Africa's banking and lending amongst the top in the world.

Well done SA... Well Done!!!
Banking Regul

If It's All About Credit - Clear Your Credit Record!

It's ALL about credit!

It's ALL about credit!

It's ALL about credit!


We know this, so why aren't we doing anything about it?
Why are the number of declines with regards to submissions for credit applications increasing every month? WE DON'T LOOK AFTER OUR CREDIT PROFILES!

Times are a little rough and with the Credit Act taking total control of any credit applications, whether it be home loans, credit cards or vehicle finance, financial institutions are having to abide by their rules. So people, lets get with the program and abide by the rules! There's nothing worse than finding the house of your dreams only to find out that you can't get a home loan because you haven't bothered making a little bit of an effort.

So what you need to do to ensure FINANCIAL SUCCESS?

1. Check Your Credit Record - Click here for your ITC & Experian credit check
2. Check for judgments & credit listings
3. Contact the companies/people who have listed you and arrange to remove them
1. Often listings are old because the bureaus just forget to remove you
2. Often listings are old because the companies you listed you haven't bothered contacting the bureaus to have to removed
4. If you pay off outstanding debts, make sure you keep proof of payment (this will be required by financial institutions from time to time

It's easy and it really doesn't take much time.

Things to remember which will assist you in keeping track of your credit records. The banks have systems that link into the bureaus which show you credit profiles for clients. Credit profiles allow the bureaus to link into all financial institutions that offer credit eg Edgars Accounts or Credit Cards;

• Don't pay your accounts late
• Don't miss payments
• Don't let debit orders go off your accounts without having funds available

Well that's that for now and I hope this helps you all. Truth is you want a clean credit profile and so do we :)

Keeping SA Credit Clean!!!
HAVE A SUPER WEEK!

South African Property Market 2008

So with tonight being the last night of 2008 it's time for the SA Property Market 2008 prediction :)... Sounds like fun, lets see how accurate we are. For those of you sitting at home waiting for some new BLOG posts, lets hope this keeps you somewhat, entertained.

Roundup of 2007
There's been some major changes and impacts in the South African Property market over the last 12 months. We've seen the rise and fall of some of South Africa's supposed fraudulent bond originators especially the story of Rudco Finance which the SA Property Team followed extremely closely. I just want to say though, that it's great to finally see South Africans standing up for their finances. It seems gone the days where fraudsters would just walk over us. A good positive to take into 2008.

Of course, who could forget the introduction of South Africa's National Credit Act. This amazing introduction by the government and financial lending boards has brought a stop to the reckless lending of credit. There was a stage when South Africans were in such financial debt, and didn't realise it. Well, we do know. And financing your property is no longer as easy as filling in a form.

We of course had the lovely problem of inflation, which after reading the Sunday Times news paper this morning does not seem to have been fixed yet. South Africa, under immense pressure, with an inflation rate sitting at around 6% is now feeling the brunt on our home loan interest rates. Interest rates have increased 4.5% over the last 6 months with talk of another 0.5% increase in the next quarter.

So after writing this article, I've decided that instead of predicting 2008's behaviour, I'm going to leave you with some tips, especially for the youth, and those looking to invest in property for the first time, in South Africa, and wherever you may be!

Tip 1 - Don't over expose yourself with too much credit! Credit is good, but make sure you have at least one account with a reputable store like Edgars.

Tip 2 - Don't buy property to your limit. I know we all want that 3 bedroom house in Clifton, but start small and work your way up! A site like myroof.co.za or privateproperty.co.za are great sites, no need to pay estate agent commission fees either.

Tip 3 - Use a reputable bond originator and someone whose a GOOD and RELIABLE financial advisor! - See Wizard Home Loans.

Tip 4 - If you're in Debt already and you are listed, make use of services such as The Debt Doctor, who provides free financial advise to those who can't afford to pay for it.

IF YOU WANT A GREAT BOOK WITH GREAT ADVICE - Buy the Suze Orman book advertised on this site - http://www.wizardmidrand.com/home-loans/debt/debt-doctor.html.

So that's that folks. Have a wonderful New Years and be SAFE!!!!

WizardMan Out for 2007!

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!

South African Property - June/July Market Summary

BOOM

It's been chaotic and exciting to say the least...

The last month in South Africa has been a shock to the home loans and property barons and I think it's definitely worth a nice little summary. For those of you who missed all the excitement, well, here's your chance to catchup!

To summarise it all, I'd say the 3 major impacts and stories have been the following:

The National Credit Act
Rudco Financial Services
Bank Charges

The National Credit Act

First was the property boom, prices rising, interest rates dropping then, WAM BAM, thank you MAM, here comes the National Credit Act. All of sudden, investors who were purchasing homes by the dozen every month, found out that they could no longer afford (REALLY AFFORD) anymore property. Banks started declining bonds left right and centre because people were hiding money from them and claiming they were earning R60 000 a month when there statements were only showing R20 000 worth of income.

To top it off, the interest rates went up! WHAT THE HELL! Well, it's not all bad. What it means is that the banks and financial institutes can no longer loan money to people who cannot afford it! It's going to curb credit lending which is great for the economy, LESS DEBT, plus all those people who've been hiding money from the TAX MAN, will no longer be able to do it with property unless you buy it cash. Either that or you need to start showing the banks where that money's coming from.

Wizard says, YAY to the National Credit Act!

Rudco

Now here's a story that's been causing a stir. Rudco Financial Services came out this week with a special, "The first 1000 people to sign up with Rudco get their home loans at 6% interest". Talk about a stir. It's had the home loans companies up in arms and it's got people asking ALOT of questions.

Firstly, well done to RUDCO, it's caused such a publicity STIR that I'm pretty sure they've already got their first 1000 deals signed up. The reason Rudco got everyone talking though was due to a couple of "suspect" things that bugged us.

1. Where is there financial backing coming from? Why won't they disclose it?

2. They're not registered as a financial institute!

3. What happens if they go under? What happens to their clients?

4. Offering home loans @6% gives clients the false impression that they can afford that R1 000 000.00 property. If Rudco go under, and the client needs to switch to a bank. Their interest rates are going to jump to 13%. WILL THEY STILL BE ABLE TO AFFORD IT!

All in all though, Wizard do wish Rudco the best of luck. Banks needs competition, maybe it's the first step!

SA Banks and their DAMN Bank Charges!

This is something that just pisses me off! The banks and their bank charges. Now I can understand bank charges. I understand that we have the highest ATM crime rates in Africa (or the world for that matter) and that banks need to replace all the broken ATM's. Let me tell you though that paying R15.00 for every debit order that comes off your FNB cheque account is pathetic! I also believe that paying R20.00 to draw money from an ABSA ATM vs a FNB ATM is absurd!

The banks in this country are not making it easy for people to live! They're not helping South Africans and they're not helping the MAJORITY of South Africans (underprivileged) in making this a country to want to stay in!

Read this article that STORM posted, read it carefully and you tell me what the hell the banks in this country are thinking!!!!!

http://sa-property.blogspot.com/2007/07/are-banks-charging-you-more-than-they.html

But ladies and gentlemen. Apart from that, we love this country!
You cannot say that this isn't an exciting country and an exiting time in South Africa.

Thanks again to all the readers and the input everyone has had on our BLOG over the last 3 months.

WizardMan OUT!
I'm OFF TO DULLSTROOM!

National Credit Act - Loopholes!

There's been alot of hoohaa about the latest South African national credit act as you may have noticed if you read all the financial and property related BLOGS.

About an hour ago I came across an article see Loopholes in National Credit Act. It's articles like this that really get my blood boiling because it makes originators look bad when they have to help clients...

According to Fin24 and John Chapman director of Rabie Property Group, there's a GREAT loophole in the new national credit act system, whereby if you register the bond in a CC or a Trust you'll bypass all the NCA laws and regulations.

1. As John mentioned, registering a bond through a CC just makes no sense due to the TAX benefits you would have to sacrifice.

2. What he forgets to mention is the following:
If you register a bond in a trust or cc i.e. ANY LEGAL ENTITY your bond costs are more than double.

For example on a bond amount of R 1 000 000.00 your costs would be R39370.00. IF you register the bond in a CC or TRUST you costs are R94 370.00. That's 3 x the bond registration costs that you'd normally pay.

BE CAREFUL WHAT YOU READ AND ALWAYS DOUBLE CHECK.

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

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!

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.

Is the CREDIT Bill wrecking you?

This is supposed to be it? You and I will be protected from "WRECKLESS" lending for homes and cars and the like. The banks will without doubt decline anything that looks like "WRECKLESS" lending as well...........AND the Credit Bureaus (Yes the same ones who nail you for not paying your Edgars bill on time) will for the first time be regulated....whoohoo!

Does this affect you and me. For sure. This means that each time I want credit of any kind, I need to do my home work properly and make sure I can afford it, not only now, but also down the road when we get one of those "MBOWENI SPIKES" in the interest rate.

The banks are all gearing themselves up seriously for this new credit act and all those people who profess to be your financial advisor better come up with committment to you and be your true agent, especially if you are a property buyer. Proper advice and backed by the banks - thats the call. (Watch them all scurrying to find out what needs to be done).

Check out - Government site - Yes it's good reading!
News sites that are excellent - Personal Finance and My Buddy Erwin Rode and Business Iafrica
Get with the act my friends - dont become a WRECKLESS nervous WRECKING lender!!!!