If you have recently thought that you no longer want to waste money on paying rent and you would rather use the money to pay into a home loan then it is possible to do so. For your own purposes, using the mortgage calculator will give you an idea of what the payments will be according to the amount you wish to loan for the purchase of your new home. Continue to read the home loan qualification criteria to see what your chances are of getting the loan you need.
There are factors and criteria that are required to qualify for a home loan. This means that the bank needs to know that you are able to pay money towards the loan every month. Therefore proof of a job, the amount you get paid and how long you’ve worked at the company or if you are self employed you need to at least have 2 years proof, your ID is also important. As the bank needs guarantees, you would need to fit into a certain income bracket to qualify for a home loan which is calculated according to your means.
There are two options for first time buyers: 1.If you have money that you can put down as a deposit for a home loan or 2. you do not have a deposit and you qualify for a home loan then the bank can grant you over a 100 percent loan.
In order to determine the amount you will pay the bank back every month is based on the interest rate. If you have money and you put a deposit down depending on the amount of the deposit in ratio the cost of the house; the bank will calculate a percentage using a loan to value ratio. This ratio refers to the amount of the bond that you’re applying for and the cost/value of the property you want to purchase. The percentage that is calculated will determine the amount which will become part of the interest rate you pay every month.
The minimum bond you can apply for is between R100 000 and R150 000 so if your LTV which is your Loan To Value ratio is calculated at a low percentage this means that the interest rate will be low as well; as it is directly proportional to the interest rate in other words the lower the LTV percentage the lower the interest rate will be to pay the bank back each month.
If you do not have a deposit then you can ask for a home loan that covers everything. Often first time home owners do not have extra money to put down as a deposit so therefore the bank makes provision for this. A bond for over a 100 percent normally 110 percent bond will cover the cost of the home and other home loan expenses including transfer fees for example. As there is always a time period associated with applying for a bond the norm in this case would be thirty years. As terms and conditions vary inquiring at a bank or using findbond.co.za can assist you with your requirements and needs.
Investing in your own home means that you can renovate or build on to your home as you like and you have the financial aid to do so. Many banks or financial institutions have requirements in order for you to qualify therefore making sure that you have a reliable and stable form of income is the first step to take to qualify for a home loan.