All you need to know about bonds in South Africa
In South Africa a bond or home loan can be secured in one of three major ways let us look at each closely.
Directly through a bank
A buyer can approach any bank to ask for a home loan. Many buyers start with their own banks, hoping for preferential treatment. They are then referred to the home loans division where they deal with a consultant who helps them complete the necessary documentation, submits their application, and informs them whether a loan can be granted. The buyer is of course free to repeat this process with the other banks and in effect “shop around” for the best deal.
Through a bond originating company
Notably these are Ooba, BetterLife Home Loans and Multinet Mortgages.
A buyer can also approach one of the large bond originating companies. A broker from this company will guide the buyer through the application process and submit the application to any of eight or nine banks in the country. If approval is granted the broker is able compare offers and negotiate rates and terms on behalf of the buyer. A buyer can also approach an independent bond aggregator. This agent also prepares the application for the buyer, and then aggregates it through one of the larger companies, whereupon it will follow the above-mentioned process.
Through a specialist bond lender
There’s SA Home Loans
A privately financed companies which specialises in residential mortgage bond lending. SA Home Loans is the country’s largest home loans provider, in operation for many years. Dealing directly with the public and competing with the banks, they often have different credit criteria to the banks and may grant bonds in instances where banks have declined applications. SA Home Loans pride themselves on offering innovative and creative loan solutions that can be tweaked to address the unique needs of each client.