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Let’s take a closer look at which factors influence the rate you’re offered on your bond and how you can secure the [best bond deal].
- Repayment-to-Income (RTI%)
The first thing any bank will consider when granting your new homeloan is whether you’re able to qualify for the necessary funds. Usually the banks will only grant you a homeloan with a repayment amount that does not exceed 30% of your salary.
- Loan-to-Value (LTV%)
The second most important factor is the LTV. If you’re looking to secure the a very low interest rate for you’ll need to save up a deposit. The bigger the deposit the lower your rate will be.
- Home Loan Size
Banks often reserve the best interest rates for home loans that are at least R1.3mil or more.
- Repayment Term
The likelihood that the bond will be repaid within the next two years determines the extent to which the loan can be profitable for the banks. If the bond will be repaid in a relatively short period of time, the bank is less likely to offer a bigger rate of discount as it is less profitable for them
- Property Loans SA – Bonus TIP
Your preferred bank will often match the rate you’re offered by another homeloan provider if you can provide proof of the better rate. This is one reason why we are able to secure the best bond deal for you. Once your application is sent to the banks and we negotiate with the various banks for an even lower rate.
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