Archive | September 2012

Heritage Day Twitter Competition

This Heritage Day we are hosting a competition on Twitter, and you could win R500! All you need to do is sign up or log on to Twitter and follow us here. You should then tweet an image of your Heritage Day activity, or a picture that encapsulates Heritage Day for you, and tweet it to @better_bond, making sure to include the hashtags #BetterBond and #heritageday in the body of your post. Simple – just follow these three easy steps:

Step 1: Sign up or log on to Twitter

Step 2: Follow @better_bond

Step 3: Tweet your best Heritage day picture to @better_bond, and use the hashtags  #BetterBond and #heritageday in the text field

We will be retweeting some of the best images, so keep them coming. And you can enter as many times as you like! We’ll be accepting entries from Tuesday the 18th September through to the afternoon of Tuesday 25 September. On Tuesday afternoon we will decide on our five finalists. Finalists will be notified via Twitter, and the finalists’ images will be uploaded to Facebook. Voting will commence once we announce the finalists. Voting will end on the morning of Friday the 28th September, and a winner announced later that day.

You can copy and paste the link on Facebook and Twitter to promote it, and ask your friends and family and other communities to like it as well. The picture with the most likes wins, so get your friends voting!

Terms and Conditions Apply

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Six reasons you probably need a mortgage adviser

It’s true that many people don’t see the value in using a mortgage broker when buying a house. Previously, mortgage brokers in places like the UK and USA engaged in risky practices that involved unscrupulous brokers arranging home loans for buyers that were unsustainable and financially damaging.

Laws have since been, and are currently being passed that will ban this kind of behaviour overseas. Thanks to the stringent National Credit Act in South Africa, consumers are more protected against major debt – especially when it comes to an investment as major as buying a house. But consumers are naturally wary about third parties, and the bad behaviour of some brokers can leave a stain on even reputable bond originators.

If you’re currently in the market to buy a house and have decided against using a bond originator, here are a few reasons why you should reconsider employing the services of a mortgage advisor before you go it alone:

1. Banks’ loan rules change frequently. It is the advisors’ prerogative to stay abreast of these developments and guide you in your best interests.

2. Comparing rates on your own takes time- time that you might not have. Using a bond originator will significantly reduce the amount of time you’ll spend shopping around for rates.

3. A bond advisor will handle the home loan application process on your behalf- again saving you time and the frustration of dealing with the red tape associated with buying a house. Using a mortgage advisor during the application process could dramatically improve your chances of having your application approved.

4. Although some bond originators may charge a fee for the services, BetterBond will assist you in your home loan application process free of charge.

5. This is their field of expertise. Whereas you will only buy one, two, maybe three homes in your lifetime, a bond originator deals with home loan applications all day, everyday and will be able to answer all of your questions and give you the best, most relevant advice when it comes to your purchase.

6. Mortgage advisers will shop around to find the best deal for you from all financial institutions. So even though you might bank with one bank, your best deal may come from another institution – a deal that you might not discover were you to go it alone.

Bond Mortgage Glossary

When buying a home, sometimes the jargon can be a little confusing. This list is by no means exhaustive, but it gives a great idea of the kind of terminology that you are likely to come across when you are looking to purchase a home.

Accrued Interest 
Interest earned but not yet paid.

BA Linked Rate
Rate linked to the 3 month BA SAFEX rate which can be monitored on an ongoing basis, and it ensures a three month fixed rate amount. The rate will change every three months in line with the cost of short term funding rates.

Bond Term 
This is the original term of the loan.

Borrower (Mortgagor) 
An individual who applies for and receives funds in the form of a loan and is obliged to repay the loan in full under the terms of the loan.

Capped Rate 
This limits the amount the interest rate on an adjustable rate mortgage can change in an adjustment interval and/or over the life of the loan.

Ceiling 
The maximum allowable interest rate of a variable rate mortgage.

Collateral 
Assets a buyer pledges as security for a home loan.

Conveyance 
The document used to effect a transfer, such as a deed, or mortgage

Cooling off period 
This is based on a new law that allows first time home buyers the opportunity to change their minds within five days of signing the offer.This clause is included in an offer to purchase a property under R250 000.

Deposit
The deposit is the part of the purchase price of the property that you pay in cash up front and reduces the amount that you will need to lend. Collateral other than property is also taken into account when calculating your loan to value ratio.

Fixed Rate 
Regardless of whether variable home loan rates fall or rise, the fixed interest rate for the agreed period will continue to apply.

Foreclosure (or Repossession)
Legal process by which a mortgaged property may be sold to pay off a mortgage loan / home loan that is in default.

Freehold 
A homeowner owns the property as well as the land it is built on.

Initiation Fee 
Fee charged by a bank to cover the initial costs of processing a home loan application. The fee may include the cost of obtaining a property appraisal, a credit report, or other closing costs incurred during the process or the fee may be in addition to these charges.

Lien 
A legal claim by one person on the property of another for security for payment of a debt.

Loan-to-Value Ratio (LTV)
This is the percentage the bank is willing to lend you, expressed as a percentage of the bank’s estimated value of the property and the loan amount required.

Mortgage or Bond 
An agreement between you and the bank, stating that the bank will lend you a certain amount of money in the form of a home loan, and that you will pay the bank back over a certain period, on a monthly basis, and at a certain interest rate.

Occupational Rental 
This is paid by the buyer to the seller at an agreed amount, if the buyer decides to move into the property before transfer of ownership takes place.

Offer to Purchase 
This is an offer in writing from the buyer to the seller to purchase. Once signed by all parties, it becomes a legal and binding contract to all parties.

Refinancing 
Paying off one loan with the proceeds from a new loan secured by the same property.

Second Mortgage 
A second mortgage is a secured load that is subordinate to another loan against the same property.

Sectional Title 
This is an entire complex divided into individual units and sold separately.

Title Deed 
A document stating ownership of a property and and details the rights of ownership and possession of the property.

Transfer Fee 
Fee paid to transfer the property from the seller into the name of the buyer.

Underwriting 
In mortgage lending, the process of establishing suitable terms and conditions for the loan and of determining the risks involved.

Usury 
Interest charged in excess of the legal rate.

Variable Rate Loan 
The borrower’s home loan rate will rise or fall according to how interest rates rise or fall.

Voetstoots 
This clause is always found in a sale document and means ‘ let the buyer beware’. All defects must be mentioned to the buyer upfront.

 

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