How to secure a 100% Home Loan
Home Loan Tips: Which banks are offering are currently offering full 100% bonds?
The four major mortgage providers in South Africa are:
Although the property market may go through its ups and downs, one of the few things that does remain relatively constant is the demand for 100% home loans.
The banks are always changing, re-evaluating and assessing their lending policies to ensure they’re keeping pace with the current market conditions.
For this reason, you should always speak to your bond originator before you decide to sign an Offer-To-Purchase on a new property.
Your bond consultant will been able to tell you what the banks are currently willing to offer you.
Currently the requirements for a 100% bond are:
A Willing Lender:
Before you can hope to secure a 100% bond you’ll need to find out which of the banks are currently offering mortgage up to 100% of the value of the property.
A Clean and Clear Credit Record:
Your credit rating and credit record are among the most important factors to consider whenever you are applying for credit.
The banks use these ratings to gauge how well you conduct your accounts. The higher your rating, the more likely you are to be approved for the full loan amount.
The interest rate on your bond is also determined, in part, by your credit rating.
Property Value and Types of properties:
Bargain Deals
In some situations, you may find that the value of the property far exceeds the price you’ve paid.
In these situations the banks are often very keen to grant you a full 100% bond, as their risk is covered by the extra value. If anything goes wrong the bank knows that you will be able to settle the bond by selling the property.
Repossessed Properties
Currently, the banks each have loads of repossessed properties on their books. In an effort to sell these properties they have launched a campaign to grant full 100% bonds on these sales.
Your Own Affordability:
And finally, the bank will not grant you a full 100% mortgage if you are not able to afford the monthly bond repayments.
In Categories: ABSA Home Loans, FNB Home Loans, Nedbank Home Loans, Standard Bank Home Loans
Related Tags: 100% homeloans, Loan-to-Value
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November 23rd, 2009 at 12:04 pm
Hi, thank you very much for this piece of information, I am very glad go through this and this has been very useful to me. Thank you very much.
November 24th, 2009 at 9:13 am
I just want to know, WHERE DO THE BANKS THINK FIRST TIME BUYERS WITH AN AVERAGE INCOME, MUST GET AN ODD R120 000 TO PAY A DEPOSIT, TRANSFER FEES ETC. ETC?? In other words average earning individuals will never be able to buy property?
November 30th, 2009 at 1:21 pm
Uzzy – agreed – where must I come up with R75,000 to cover deposits and transfer fees and, and, and…
This website, however, does have some great property info – it has helped me very much so far!
December 2nd, 2009 at 9:41 pm
Uzzy: “I just want to know, WHERE DO THE BANKS THINK FIRST TIME BUYERS WITH AN AVERAGE INCOME, MUST GET AN ODD R120 000 TO PAY A DEPOSIT, TRANSFER FEES ETC. ETC??”
Uzzy, you are right, the ‘average people’ are screwed. However don’t blame the banks, blame the government with their stupid National Credit Act.
December 8th, 2009 at 12:10 pm
I think this article is very misleading because many of the banks are still applying a threshold of 90% although they are advertising 100% facilities, covering themselves by the “up to” portion.
I know of at least one bank which is advertising “up to” 100% loans but its valuations are capped at 90% and its LTV valuations are not based on market value but on mortgage value. So in fact, a person with an impeccible personal portfolio might get a very good rate but if the bank thinks that in the case of a repo sale it may only be able to recover 85% of the market value that would be the LTV it would offer.
January 8th, 2010 at 3:26 pm
I just went through the excruciating process of approaching FNB (of which I am a premium banker), finding out what I could afford and given a figure that I could offer when looking for a house. Found a house, went to get the loan… REJECTED!!! Thanks for nothing FNB!
February 5th, 2010 at 12:32 pm
Is standard bank not offering home loans now?
February 10th, 2010 at 8:21 am
@Euginia
Standard Bank are certainly still offering homeloans.
At present they will even consider offering you a 100% bond.
The banks are constantly reviewing their lending criteria, and adjusting them to match the current market conditions.
Feel free to contact us directly if you would like more information about this.
email: olen@propertyloans.co.za
ph: 0861 111563
March 1st, 2010 at 10:53 pm
I need 100% mortagage in SA for buy to let residential or commercial property. Im not South African & i live in UK.Salary is >£50k per year. Just wondering if this is feasible.Willing to get advice via email re banks that offer such facilities and how I can go about it. Cheers
March 17th, 2010 at 9:32 am
Just something i wanted to share,I recently approached my bank and FNB,Nedbank, standard bank, SA homeloans etc….And guess what, even with a income of 40k gross and a squeaky clean slate,I could get no more than 90% and the thing is i had the moeny to cover lawyers fees as well as bond cost etc, and all i needed was a 100% purchase price bond and it was denied, i think this BEE thing has more to do with society than people think – its disgraceful!!!!!