Can I afford a house big enough for me and my growing family? Will the bank accept my home loan application? What if I miss my payments? According to FNB expert Eunice Sibiya these are just some of the questions you need to answer before you take out a home loan.
It's an exciting time, looking at houses and meeting with estate agents however one needs toremember that this is probably the most expensive purchase you'll ever make so you need to take careful steps.
The timing of your purchase is important. The longer you take before you buy, the less time you have to pay off the bond before you retire.— Eunice Sibiya, FNB Head of Consumer Education Program
According to FNB's property buying statistics, most home buyers are only buying properties later in their lives. The average age of buyers is around 44 years. Total buyers below the age of 40, where most first-time buyers come, declined from 49.1% in March 2012 to 42.94% in August 2017.
Ultimately when, where and how you buy your first property depends on your personal circumstances. So make sure that you are able to afford your bond once you apply for it says Eunice Sibiya.
Here are 8 steps you can take There are important steps you can take to find the home you want to live in at a price that you can afford
Check your credit score - A clean credit record dramatically increases your chance to get a home loan as it may position you as a low risk consumer.
Use the FNB Home Loan Bond Calculator - You can determine your monthly bond repayments based on the home loan amount.
Check the property valuation - Make sure that the amount you are borrowing matches the property's market value.
Save up for a deposit - A deposit helps you to reduce the loan amount, loan term and you can save money on the level of interest you pay.
Pay a little extra on your bond - If you pay 10% extra on a bond of R1 million you could cut approximately four years and R250 000 off the cost of your bond. This saving can be used for new investing ventures.
Get the right insurance cover in place - Life insurance will ensure that you and your family are protected financially if something untoward happens to you - like death or disability. Short-term insurance will cover you against incidents of theft, fire or accidents.
Understand all the terms of your loan contract - Before you sign, read every line of your loan contract. If there is anything you don't understand, ask for clarification.
Regularly revisit your personal finances - Monitor the progress of your home loan. Make sure that you are on track with your short-term and long-term goals.
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