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The Best South African Bonds |
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Financial Advice – South Africa Bonds
Many South Africans aboard take the opportunity to invest into property back home and unless you are amongst the lucky few there is every likelihood you will have to take out a South African Bond to finance your property purchase.
A South African bond often represents the biggest debt / investment an individual will take on and it is a good idea to ensure you have a full understanding of how bonds work, how to access the best rates, the correct type of bond and any special offers. Below is some useful guidance to obtaining your South African bond, including details of a special offer for Home-bru visitors that can save you a minimum of R7, 000.
What is a bond?
Can I get a bond when working abroad?
How do I make sure I get the best rate?
How much can I borrow?
Do I need a deposit?
What is a pre-approval?
Why should I get a pre approval?
What is an ACCESS bond?
Can I use my bond payments against any tax liability?
I already have a bond, can I borrow more from the bank?
Can I obtain a bond to build?
What is a bond originator?
It is a brokerage?
What do bond originators do?
Is it best to go straight to my bank?
What sort of interests will I pay?
How much will my monthly payments be?
Must I take out life cover?
Can my foreign partner or spouse be on the bond?
What are bond registrations costs?
How much can I expect to pay?
Are there any special bond offers?
What is a bond?
It is a bank loan, or mortgage secured against a property.
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Can I get a bond when working abroad?
Yes, we make it easy for you. Nationals and foreigners qualify.
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How do I make sure I get the best rate?
By negotiating with competing banks, we do that for you.
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How much can I borrow?
The amount is based on your gross income. Let us advise you.
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Do I need a deposit?
Not always. A deposit of 10% or more will get you a better interest rate.
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What is a pre-approval?
It is a document noting the bond amount that you qualify for according to your gross income.
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Why should I get a pre-approval?
So you are ready to purchase when the right opportunity presents itself.
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What is an ACCESS bond?
It is a bond that allows you to make withdrawals and deposits, and you only pay interest on the outstanding capital loan. It is a revolving credit facility with the interest calculated daily on capital balance.
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Can I use my bond payments against any tax liability?
Yes, the interest portion is tax deductible.
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I already have a bond; can I borrow more from the bank?
Yes, you can increase your loan. We can assist you with this.
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Can I obtain a bond to build?
Yes, you can get a Building bond or an Access bond, depending on the value of the land. We will advise you on the best option to suit your needs and situation.
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What is a bond originator?
Like a broker, a bond originator is the middle-man between client and the banks. We are part of a large group of originators providing banks with bulk volume applications, thereby negotiating lower interest rates than the banks can provide to individual applicants.
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It is a brokerage?
Yes, an independent brokerage with no allegiance to any bank.
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What do bond originators do?
Bond originators administer your application, liaise with several banks and negotiate the best rates for you.
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Is it best to go straight to my bank?
No, as you will not enjoy the benefits of lower interest rates and efficient administration.
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What sort of interests will I pay?
The current prime lending rate is 15.5%. You will pay between prime less 1% and prime less 2%, depending on the loan amount and your gross income.
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How much will my monthly payments be?
You will pay R 12300 / month per R 1 million loan, at prime less 1.5% over 20 years.
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Must I take out life cover?
It is not compulsory, but is certainly prudent to have our financial advisors provide appropriate advice to protect you and your dependants from potential financial shortfalls.
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Can my foreign partner or spouse be on the bond?
Yes, co applicants are permitted.
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What are bond registrations costs?
They are the legal fees charged by attorneys to register the bond in your name(s).
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How much can I expect to pay?
R7650 on a Bond registration of R500 000
R9762 on a Bond registration of R750 000
R11130 on a Bond registration of R1000 000
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Are there any special bond offers?
There are some offers in the market place. Home-bru visitors can benefit from a special offer by the contributors of this article Incompass Bonds. Incompass Bonds undertake to pay the bond registration fees on bonds over R500, 000 meaning a saving of a minimum of R7, 000.
See here for details
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