Make sure high earners also get home loan help

house-pricesRecent high profile liquidations and sales in execution have clearly shown that over-indebtedness and trouble paying the bills is not just a problem for lower and middle-income families.

High earners are just as vulnerable to economic downturns and financial problems – and the banks know this, which is why they are just as careful in assessing their bond applications as they are in evaluating those from people with lower incomes.

However, we often find that high earners – those with incomes of R35 000, R50 000 or even R100 000 a month are unprepared for this, especially if they have been living in the same house for many years, and have not bought another property recently.

Indeed, they often just assume that they will qualify for a bond because they have a lot of money coming in every month, and may already have quite a large asset base. What they don’t realise is that in terms of the National Credit Act and their own lending criteria, the banks will now also look at how they are spending their money each month, and assess from that whether they are a good or bad credit risk.

In other words, the banks will scrutinise their credit records and sources of income and money management habits, and treat them pretty much like everyone else, and they unless they are forewarned of this, they may feel that their financial privacy is being quite unnecessarily violated.

In fact, the whole bond application process may become so distasteful to them that they will simply “walk away”, irrespective of whether there is a sale pending or not.

However, agents can avoid this – and potentially a lot of embarrassment all round – by always presenting home loan pre-approval as part of the buying process, and working with an originator such as BetterBond to help such buyers achieve pre-approval before they make any offers to purchase.

With the assistance of a qualified loan consultant, high earners can detail their earnings and expenditure in a calm and professional atmosphere, and generate and provide all the necessary paperwork for the home loan qualification process without fuss, and without the pressure of an impending transaction.

And most importantly, they can do so privately and confidentially, so they need not feel any embarrassment if they don’t qualify for the loan they had in mind, or need to tidy up their financial affairs before they can even lodge an application.

Remember, everyone feels happier if they know what they are doing and what to expect, and agents who help their buyers – high and low – to feel like this, will have “clients for life”.

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About BetterLife Home Loans

Since 2003 BetterLife Home Loans has been SA’s No.1 Bond Originator, handling the entire home loan application process on your behalf – free of charge! Our aim is still to source the best interest rate for you by submitting your home loan application to all the major banks. There is no easier way to apply for a Bond or Home Loan in South Africa!

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