How to double your chance of getting a home loan – and a good rate
BetterBond - South Africa
The chance of a home loan application succeeding now if it is not submitted through a reputable originator is less than 40%, according to the latest statistics from BetterBond Home Loans, SA’s leading mortgage origination group. “Our latest figures show that in the past 12 months we have succeeded in ‘rescuing’ almost one in four (37%) of all the home loan applications we've handled, by being able to motivate them properly and, if necessary, submit them to a second and sometimes even a third lender,” says BetterBond CEO Shaun Rademeyer.
“They also show that our overall approval ratio for this period was 74%, which means that only 37% of applications succeeded in attracting an offer from the first bank to which they were submitted – or would have been likely to succeed if the applicants had submitted them on their own.” However, he adds, this is not because the banks themselves have had less appetite for lending. “In fact, if anything, they have been more accommodating, with both the number and value of home loan approvals obtained in the 12 months to end-September remaining virtually unchanged compared to the previous 12 months, despite a slight drop in the number of applications submitted.”
How to double your chance
Judges rule for property owners against banks
IolProperty - South Africa
After three years, the Moores finally own their house. Again!
Six years ago, the Vereeniging couple fell prey to a reverse mortgage scam known as the Brusson scheme, named after the unregistered credit provider who managed to dupe about 900 people into handing over ownership of their properties in exchange for a loan. The Moores received notice that the sheriff of the court would attach their property in August 2011, but less than two weeks ago, they knew that their home was safe.
This is because the Legal Resources Centre (LRC), which is representing about 100 people affected by the scheme, won a judgment in the high court in Joburg on September 26 to return ownership to the Moores. Although the bank was not party to the scheme, Acting Judge Mohammed Chohan found Absa could not attach the property because the Moores had not intended to transfer ownership of their property to a third property.
Co-ownerships of property attractive again
Gunstons Attorneys - South Africa
Contrary to what is often thought and said, co-ownership of properties is not frowned upon by those banks active in the property bond market, nor are the legal arrangements difficult to sort out, says Denver Vraagom, a conveyancing attorney with the Cape legal firm, Gunston Attorneys.
“This type of investment, along with buy-to-rent, is once again on the increase and very much in favour. Co-ownership can be a highly effective way to get into the property market and certainly in our firm we have helped a number of people to do just this. It is important, however, that the initial agreement makes allowance for the various incidents and changes that can happen down the line, for example, one of the partners becoming unable to pay or wanting to opt out or other family members or beneficiaries needing to be included in the ownership.”
In his experience, said Vraagom, most co-ownership deals last for five to ten years after which the stronger partners buy out the shares of the weaker ones or those who now have other priorities such as investing in a new business.
Co-ownerships of property are attractive
September House Price Indices
Absa - South Africa
Middle-segment house price growth marginally down in September
Year-on-year growth in the average nominal value of middle-segment homes in the South African residential property market was marginally lower in September this year compared with the preceding month. This came on the back of a declining trend in month-on-month price growth since January this year (see graph below), which was, as expected, eventually reflected in lower year-on-year price growth.
Real house price growth, i.e. after adjustment for the effect of consumer price inflation, remained relatively subdued in the first eight months of the year compared with the corresponding period last year, impacted by the fact that consumer price inflation averaged 6,2% year-on-year (y/y) in January to August. These price trends are according to the Absa house price indices, which are based on applications for mortgage finance received and approved by the bank in respect of middle-segment small, medium-sized and large homes (see explanatory notes).
House Price Indices Sep 2014