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What To Look For In An Absa Homeloan
June 16, 2010 by man
Filed under First Time Home Buyer Michigan
When you desire to buy a house in South Africa, an ABSA (Amalgamated Banks of South Africa) mortgage is your best bet as it has a great reputation and will handle your account with professional courtesy. They won’t use unnecessary jargon and will eliminate any unwanted surprises that other lenders may hand you at the last minute.
There are lots of loans available for your needs, and ABSA will have all that information at its fingertips. It will match your situation and goals to the right loan and take a lot of care to make sure that you are well serviced.
Naturally you’ll need to bring your records when you apply to ABSA for a home loan. These will entail proof of verifiable income of at least ZAR3 500 to show that your monthly loan bill will not be higher than thirty percent of your income. This is for both you and the lender, so that you don’t run the risk of defaulting.
Most home mortgage loans can be divided in two different categories. These categories are also present in ABSA; the fixed inters rate loan and the variable rate loan. The benefit of fixed rate mortgage is that you will know precisely what your mortgage interest and principal payments are going to be and hence plan your budgeting in accordance. The variable rate mortgage allows the interest rate to fluctuate on regular basis. With a variable rate of interest you cannot predict what your monthly repayments will be. You will reap the benefit when interest rates fall but conversely you will have to pay more when they rise.
The reason for denial of your ABSA loans is narrated here. First one is that if you have a very bad credit record or if you are unable to prove your income. Second condition is that if you already have furniture, a vehicle or a home repossessed attributable to non-payment you will not qualify for an ABSA home loan. Third one is if you have any arrears with taxes, utility bills etc you will disqualify for an ABSA home loan. More over your bank accounts must be properly managed and you have to bring at least 6 month’s worth of your bank accounts.
The property by itself should not be in a dilapidated condition; but should be in a reasonably decent condition, not in requirement of extensive repairs. The property should also qualify for insurance. The bank, it is to be made known, will require you to oblige the bank with a homeowner’s assurance policy which will give protection or shield to cover the property from any possible damages due to natural calamities like storm or fires and such.
