PROPERTY FINANCE
“ This is where comparing home loans can be of great advantage . Our latest statistics show that we helped customers to achieve an average interest rate of prime , less 0.23 % which translates into big savings in the long-term ,” says Dyer .
OTHER KEY FACTORS TO WEIGH UP
Dyer urges buyers to weigh up a host of elements in choosing where to apply , rather than simply waiting for bond approval by their own bank . “ There are a host of factors to be considered , given all the options available to homeowners today . All of these can be carefully explained to you .”
2 . REPAYMENT PERIOD :
A home loan term is generally a choice of 20 or 30 years . A 30-year bond means lower monthly repayments on a higher interest rate while a 20- year bond means higher repayments on a lower interest rate . “ A 30-year bond costs more in the long-term but will leave you with more room for additional expenses each month . A bond originator can help you to weigh up what ’ s best based on your affordability .”
3 . JOINT BOND OWNERSHIP :
“ We ’ re seeing an increase in joint bond applications where two ( or more ) people apply together for a bond on the same property . This process is more complicated in some ways as the banks look at the affordability of both / all parties , so it ’ s good to cast a wide net when applying .”
4 . DEPOSITS :
The uptick in 100 % ( zero-deposit ) bonds being granted by the banks has played a major role in the sustained demand for home loans . “ Of the home loans approved through ooba Group in Q1 of 2022 ( 82 %), 64 % of applications were for buyers who required financing for the full purchase price – a 5 % increase on Q1 for 2021 .” However , Dyer cautions that it does have some drawbacks so it ’ s vital that potential buyers work closely with bond originators to determine whether it ’ s the best option for them . “ Prior to applying , it ’ s important that you work with a bond originator to 1 ) determine your credit score and affordability 2 ) weigh up the financial pros and cons of a 100 % bond and 3 ) have a clear understanding of the criteria that different banks use when deciding whether to approve a zero-deposit
32 JUNE 2022 SA Real Estate Investor Magazine