A significant number of lower income earners are now realising their dreams for purchasing their own home, but in reality many are still unable to afford a home. Purchasing a home is not just an investment, but it is also a place to create memorable moments that will last forever. Middle class families are always looking forward for purchasing their own home. However, due to less income they can not afford to buy home. Home Loan facility is the best option for them to buying their own home.
In South Africa, currently the repo rate is 5.00% and the prime interest rate is 8.5%. The property rates are increasing, however, interest rates are still fix. For many people, a low interest rate is an opportunity to pay off debt and get financially fit to deal with the ever-increasing cost of living. Due to fixed interest rates, loans can be payoff faster without affecting budget.
Buying a home is a big financial commitment so before buying a home, you should spend much time for making the decision. There is no any income bar to qualify for a home loan. But banks will qualify the applications according to the applicants income.
According to the Rawson Property Group's national manager, Mike van Alphen, approximately 20% of bond applicants are found with 100% of bond. Among these applications, many are getting rejected because the guideline given by the National Credit Act are not properly followed. In following circumstances chances of your loan rejection is more :
If applicant have high credit card debts or personal loans etc.
If applicant have changed jobs/business or you have just started your job/business.
If applicant have taken Loan in past and have not paid installments on time then also chances for loan rejection is high, because when applying for home loan, the buyer’s credit and payment history is checked.
When applying for Loan, you should consult your financial advisor or bank and prepare your application. Do not hesitate to get the help of professionals.
