In days past when we bought a house and needed to finance it, we went to our bank, spoke to our bank manager (who was a good personal friend in many instances) gave them our latest pay slip and voila! … the bond was approved without too much hassle.
Things have changed since then and for the past 14 years that I have been involved in the Home Loans industry it has become increasingly difficult to get that bond approval from a bank to buy your dream home. Don’t get me wrong, if you have a decent credit profile, earn enough and are able to put down a small deposit, you should have no problem getting finance at a fair interest rate. But boy, just do something out of the ordinary like own your own business or apply for a 100% bond, then you will have to face a barrage of questions and supply a heap of documents just to get your application to the credit department for consideration.
Ok, maybe I’m exaggerating slightly, but the point I am trying to make is it’s not as simple as you think and working with an experienced specialist who has hopefully handled many applications like yours, regardless of the complexity of it, most definitely has its benefits. In fact, there are no drawbacks to making use of the services of a Bond Originator when applying for a Home Loan. Let me expel a few myths we commonly come across:
1) I will have to pay for this service… myth! We are paid by the banks as per the contracts we have in place with them.
2) The bank will give me a higher interest rate because I did not approach them directly and they now have to pay the bond person…myth! There is no difference between the offer a bank will make a client, regardless whether the application came directly or through the Origination channel.
3) I will get bond approval quicker if I approach my bank directly…myth! We often obtain full approvals within a few days, it just depends how complete the application was submitted and motivated. I recently received a Full Bond Quote for a client within a day after receiving their documents and submitting to the banks. Within 2 more days we had finalised interest rate negotiations between the various banks and the client made a decision on acceptance.
4) My Private Banker can get me a better deal than any Originator ever can… myth! We deal with various banks and often the criteria is different for various types of applications, we are sometimes able to obtain offers your bank cannot make, due to various factors. Also, even if your bank makes a good offer and we obtain a competitive offer from another bank, your Private Banker can still get involved to improve or fine tweak their offer and ensure you stay with your bank by bettering another bank’s offer.
Over the coming months I will be providing some advice you will hopefully find helpful, whether you are a first time home buyer or have a portfolio of many investment properties. Whether you are an executive who earns a very good income package or a student that wants to start saving up for a deposit to enter the property market, I hope to add some value for you.
I am always open for your questions and comments. Please find my contact details below.
Happy house hunting!
Franchise Owner – Cape Town
082 926 2884 021 180 4541/2 0866 355 496