Frequently Asked Questions

Affordability – Maximum Home Loan Qualification
As a general rule, home loan repayments may not exceed 30 % of (joint) gross monthly income.
Your interest rate the bank will award depends on your repayment term, size of bond, joint income and general profile of client.

Before you start house – hunting, contact us to “pre-qualify” you. for a homeloan. You will then know what size bond you qualify for.
Once you have identified your ideal home and signed an “Offer to Purchase” or “Deed of Sale” you need to advise us accordingly.
Our Consultant will conduct an interview with you to obtain required information both in terms of the bank-and national Credit Act criteria (latter enforced in 2007).

Apart from the offer to purchase we will need a copy of your ID document (and spouse if married) , and proof of income. These documents will accompany your application to the bank .and within 2 working days of submission, providing we have all of the required documents from you, the bank will issue an AIP , i.e. Approval in Principle. We will always apply for a 100% bond on your behalf.

Legal-and other costs: There are two types of legal costs involved , i.e. bond Costs and Transfer Fees
Bond Costs are based on the size of the bond and comprise of Conveyance fees, FICA fees, Post & Petties and VAT
Example: On a R600 000 bond, Bond Costs will be R10190.
Transfer Fees are based on the selling price of the property and comprise of Transfer Duty , Conveyance fees, Deeds Office Fees , FICA fees , Post & Petties and Vat. Example: On a R600 000 bond, transfer fees will be R5000. Total Cost: R15 190

When buying property in a new development or a brand new single residential unit, transfer fees are normally included in the purchase price.

Rates and Taxes are due in advance, calculated till financial year-end of that specific local authority, when moving into a new property. In the following year home owners make arrangements to have each year’s rates and taxes paid over 12 monthly instalments.

Valuation fees need to be paid to the bank or appointed evaluator in cases where property, both building and vacant land, needs to valued before final loan approval is granted. Not applicable when buying in a new sectional title development.

Rates, Taxes, Water & Electricity, Sewerage and Refuse fees are only payable by residents from the date of occupation and not from the date of registration.

Types of Residential property

• Own title: This is a free-standing unit in a complex with individual erf no and own water and lights bill. A small levy is payable to cover certain aspects like security gate control to the complex and garden services for the communal ground. A Home Owners Association, appointed by the owners, regulates the affairs of the complex. NB a “special levy” may be raised to cover maintenance costs. Check with the home owners association before you put pen to paper.

• Sectional title: This is normally a flat or townhouse in a complex, or block of flats. A fixed monthly levy applies to cover amongst others insurance of structures, water, maintenance to exterior of building, security, communal pool and rates and taxes. A body corporate regulates the affairs of sectional title owners. Certain terms and conditions are applicable and the approval of the Body Corporate is required to deviate from any such conditions. NB: Check with Body corporate the status of the complex’s financials. If in red, you are co-responsible even of you have just moved into your new unit!

• Single residential: This is a “normal” free standing home in a suburb.>

• Vacant Land: As the name indicates, a vacant plot or erf on which one intends building a dwelling at some stage in the future.

• Plot and Plan: One buys the vacant land and can choose from a few different house styles to erect on the land. The land first transfer into buyers names after which the bank charges interim interests on that portion of the bond , and which is repayable on completion of the house , or one can choose to start repaying the land portion from date of transfer. Once the house is completed, the property transfers into buyer’s name after which the full bond becomes repayable.

• Residential area: The old rule of buying the cheapest possible property (often neglected and in need of a lot of TLC ) in a better residential area still applies. The return on the sale of a renovated, upgraded home in a good area will enable you to buy a more expensive more luxurious home in a better suburb. Many first time buyers start this way and buy, renovate, and sell, moving into a better area until they can afford the mansion they have always dreamt about. If you are not the renovating type, then always attempt to buy in the best possible area your budget allows you to. This way you will always ensure a better return when you on-sell. It is also useful to monitor property trends. Nowadays many previously run-down, neglected areas are enjoying a revamp and becoming trendy places to live and be seen in.

A Bond Originator acts on behalf of the potential home owner by going to the various banks and negotiating the best possible home loan package. This is supposed to be a free service to the client as the banks pay a commission to the broker for business placed with them.

At MortgageMax Nationwide Home Loans we pride ourselves on the ability to deliver client service excellence. This is the very cornerstone of our business and our approach is and has always been to chase a relationship with our clients rather than just a deal. We believe that by first winning the hearts and minds of our clients, the business will naturally follow. During the past six years this philosophy has paid huge dividends to our business.

Some valuable advice:
Tip 1: Pay any available cash into your home loan to reduce both interest repayments and the repayment term of the bond
Tip 2: Register your bond after the 20th of the month and your first bond repayments only goes off two months later, e.g. register 22 October, first installment 1 Dec. this provides some much needed cash flow when moving into a new property.