PROPERTY & INVESTMENT
18 R E T I R E M E N T such as a roof leak or car breakdown , could throw your household into a financial spin . This is where access to cheap credit could come in handy . ‘ The longer you stay in your home , the greater the chances of becoming “ house rich and cash poor ” – you owe little on your home but you ’ re short of cash for the upkeep or improvement of your property .
‘ The good news is that , as the value of your home increases over time , it will create additional equity that you can access to upgrade and renovate your place , but you ’ ll only be able to do that if your home loan account is still open ,’ adds Coetzee .
However , these reasons shouldn ’ t put you off the idea of closing the account if you no longer want it or need it . It may also be a good idea to close the account if you ’ re easily tempted to use the money on frivolous things that will just result in your being in debt again .
Whatever you decide to do , be sensible about the timing and know what fees you need to pay before you close your account .
If you ’ re uncertain , seek advice from a financial advisor who can talk to you about your personal money goals and help you make choices that best suit your needs .
Closing your account
If you do decide to close your home loan account , remember that you will be liable for bond cancellation fees . You may also be charged additional interest if you fail to notify your bank in advance that you want to close your home loan account . Banks usually need 90 days ’ notice .
Angelique Ruzicka