Step-by-Step Advice for Homeowners
1 . Increase Your Monthly Repayments Property owners with prime-linked bonds will see their monthly repayments drop slightly . Kondowe encourages homeowners to use this opportunity to increase their bond repayments . “ Instead of using the savings for discretionary spending , channel the extra funds into your bond . This will reduce your overall loan balance and save you money in the long term ,” he says .
2 . Top Tip : “ Even a small increase , such as an extra R100 or R200 a month , can significantly reduce the total interest paid over the life of the loan ,” says Rhys Dyer , CEO of ooba Group .
3 . Use Lump Sums Wisely If you receive a bonus or any lump sum payments , consider directing a portion of that money into your home loan . This strategy can reduce the principal balance , shortening the term of the loan and saving on interest . Stephen Whitcombe , MD of Firzt Realty , highlights that a R30,000 lump sum on a R1 million bond at 11.25 % could save homeowners over R230,000 in interest and reduce the loan term by nearly two years .
4 . Reevaluate Your Bond Strategy Homeowners with flexible or access bonds should consider drawing on their equity when necessary but also make sure they are using the funds to maximize financial benefits . By keeping these savings within your bond , they are working harder for you by reducing your loan balance and saving you money on interest
5 . Focus on Long-Term Financial Goals For first-time buyers , Kondowe stresses the importance of understanding your financial position before committing to a bond . “ Get pre-qualified for a loan to gain a realistic picture of your finances , including what you can afford without overstretching ,” he advises . Buyers should also factor in other financial obligations , ensuring they can comfortably manage monthly repayments over the long term .
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