If you want to buy property, the good news is that banks are approving more home loans. The current stable interest rate lending environment coupled with slower growth in property prices means getting a bond for a home is notably more affordable now compared to 2017.
"The home loan approval rate is also the highest it has been in 10 years. One of the main reasons for this is that there is stronger competition amongst banks. This is beneficial to buyers as it means there is more opportunity to negotiate a home loan structure and lending rate that works in your favour," says Gerrit Disberg, Director of Engel & Völkers Financial Services.
These days applying for a home loan is easier. Applications can be made through one mortgage originator who will then submit to all the major banks through their online system, so there is no need for an individual to submit to each individual bank. In the past, the process of assessing a buyer in order to prove affordability was a painstaking and lengthy process. The method has changed significantly in the past decade, says Disberg.
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People are making use of bond originators - originators provide a free bond application service through all the major banks on behalf of the buyer at no cost. In essence, they are a broker between client and bank. It is the originator's job to assist individuals to acquire the lowest possible home loan rate and to guide them through the process, he says.
Bond origination companies are highly instrumental in the way in which the home loan origination process is handled. A good bond originator understands the landscape, they have experience and in-depth knowledge of the banks' requirements, and are familiar with lending criteria and legislation.
Why you should consider using a bond originator?
The services of a bond originator are beneficial as consumers no longer need to apply to each and every bank themselves in order to compare costs. Using an originator is the easiest, least expensive and most productive way of applying for a home loan. There is also only one set of forms is to be completed. Originators work electronically, and banks are usually quick to process and respond to their applications.
"Primarily, an originator ensures that the buyer receives the lowest possible home loan rate, thus saving thousands of rands over the bond repayment period. The client incurs no costs for the services - the bond originator receives a fee from the bank once the loan application has been approved and processed," says Disberg.