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28 August 2014

Don’t fix your rate - reduce your balance
Chas Everitt - South Africa
The prospect of further interest rate increases this year and early next year has sent many borrowers running to their banks in pursuit of fixed interest rates on their home loans and other debts. However, says Berry Everitt, MD of the Chas Everitt International property group, the time to fix a rate is when interest rates generally are dropping or constant, not when they are rising.

“By the time the Reserve Bank has started to raise rates – as it did in January and again in July – and the banks are anticipating further increases, you will most likely be charged a hefty premium for the privilege of a constant monthly repayment. “For example, if you are currently being charged the prime rate of 9,25% on your home loan, most banks would raise the rate to at least 11,25% (and probably more) if you asked them now for a fixed rate for, say, the next two years.
Don't fix your rate

Title deeds and property insurance
Engel & Voelkers - South Africa
A Title Deed is the legal document which legally confirms the ownership of a property and is filed at the Deeds Office and contains details of the property. From the time that you registered a mortgage bond with your bank on the property that you purchased, they keep your Title Deed in safe custody until such time as your home loan is fully paid.

Up to that stage they are legally entitled to keep the title deed as it effectively belongs to the bank who has loaned you the money to purchase the home. It is a custom for the banks to provide home-owners' insurance (HOC - home owner's cover) for owners with a home loan, which insures the property against damages - this is a requirement of the home loan before it is granted. You may opt to arrange your own insurance, and if the bank is satisfied with the underwriters, they will allow this.
Title deeds and property insurance

Land tenure 'a two-way street'
IolProperty - South Africa
Tenure means a period under which a person has the right to hold employment or term of public or private office. Security of tenure refers to a permanent position of employment, like the security of tenure of the office for judges.

In a feudal society, tenure dealt with land ownership and land possession. All land belonged to the king. The tenant was a landholder, who had the right to possess land. In return, the tenant had to render many services to the lord.

'The various types of arrangements between the tenant and lord were called tenures. The most common tenures provided for military service, agricultural work, economic tribute or religious duties in exchange for land.'
IolProperty

GDP Stats relating to SA's household sector
FNB - South Africa
While South Africa narrowly avoided a technical recession in the 1st half of 2014, given that 2nd quarter GDP (Gross Domestic Product) growth returned to positive growth territory, a closer look at the numbers still pointed to a deterioration in the situation for South Africa’s Household Sector.
FNB

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