How to secure a 100% Home Loan

Home Loan Tips: Which banks are offering are currently offering full 100% bonds?

The four major mortgage providers in South Africa are:

Although the property market may go through its ups and downs, one of the few things that does remain relatively constant is the demand for 100% home loans.
The banks are always changing, re-evaluating and assessing their lending policies to ensure they’re keeping pace with the current market conditions.

For this reason, you should always speak to your bond originator before you decide to sign an Offer-To-Purchase on a new property.
Your bond consultant will been able to tell you what the banks are currently willing to offer you.

Currently the requirements for a 100% bond are:

A Willing Lender:
Before you can hope to secure a 100% bond you’ll need to find out which of the banks are currently offering mortgage up to 100% of the value of the property.

A Clean and Clear Credit Record:
Your credit rating and credit record are among the most important factors to consider whenever you are applying for credit.
The banks use these ratings to gauge how well you conduct your accounts. The higher your rating, the more likely you are to be approved for the full loan amount.
The interest rate on your bond is also determined, in part, by your credit rating.

Property Value and Types of properties:
Bargain Deals
In some situations, you may find that the value of the property far exceeds the price you’ve paid.
In these situations the banks are often very keen to grant you a full 100% bond, as their risk is covered by the extra value. If anything goes wrong the bank knows that you will be able to settle the bond by selling the property.

Repossessed Properties
Currently, the banks each have loads of repossessed properties on their books. In an effort to sell these properties they have launched a campaign to grant full 100% bonds on these sales.

Your Own Affordability:
And finally, the bank will not grant you a full 100% mortgage if you are not able to afford the monthly bond repayments.

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22 Comments For This Post

Nikhel Says:
November 23rd, 2009 at 12:04 pm

Hi, thank you very much for this piece of information, I am very glad go through this and this has been very useful to me. Thank you very much.

John Davies Says:
March 1st, 2010 at 10:53 pm

I need 100% mortagage in SA for buy to let residential or commercial property.

I’m not South African & I live in UK. My salary is > £50k per year.
Just wondering if this is feasible.

Willing to get advice via email re banks that offer such facilities and how I can go about it. Cheers

Gino S Says:
March 2nd, 2010 at 5:09 pm

Hi John, 100% mortgages are only currently available to South African citizens. Although, this ruling could change in the future.

I would suggest subscribing to our email newsletter if you’d like to receive a notice if/when this 100% bonds become available to foreign buyers.

Mimi Says:
May 5th, 2010 at 1:43 pm

Hi, I want to find out a person that earns a gross amount of R20526.50pm and a nett of R13372.48 pm, under normal circumstances, approximately how much bond would they qualify for? I know the Credit act applies and all the other expenses/credit are taken into consideration.

I’ll appreciate your assistance.

Paling Says:
May 20th, 2010 at 2:46 pm

Hi Mimi,

You will be allowed to commit up to 30% of your gross income to debt repayments.
If you are buying with someone else, that person’s gross income can be added to yours.
You also need to take into acount existing debt and those installments.
Your approximate max loan amount (under 14% interest rate conditions for safety’s sake) is then given by:

{(GrossIncome x 0.3) – ExistingDebtInstallments} x 80

E.g. if you’re buying on your own, and you’re paying R1200 per month on other debt, then

{(20526.50 x 0.3) – 1200} x 80
= { 6157.95 – 1200} x 80
= 4957.95 x 80
= R396,636.00 max allowable debt

This should give you a rough idea, work with +/- R50,000.00 on this. You can also Google for calculators.

Whether or not you’ll receive a bond for this much also depends heavily on the property value, how much you offered, and anticipated market movement (see my previous comment).

yuan prins Says:
August 21st, 2010 at 6:51 am

want to buy my parents house with a 2nd home on with an rental of R3000 per month for the next 5 years and at the moment I am paying R5000 rent for an mine house

house price R1050000 and the value is +- 1200000

Annelise Says:
February 1st, 2011 at 6:06 pm

I have not gone to the banks yet, but would like to buy a house as I think renting is a waste of money. Is the process really this difficult?

I surely dont have R75 000 laying around in my cupboard to pay for a deposit.

Elienah Says:
April 30th, 2011 at 1:05 pm

I’m with you on this Annelise. We spent a lot of money on rentals. we want to buy our own houses but with all these requirements and procedures we will probably be one of those unfortunate to own a house.

EDDIE MULLER Says:
June 6th, 2011 at 12:08 pm

Hi can you please help . Need a bond of R850 000.

andrew Says:
June 19th, 2011 at 11:42 am

Hello, what is max Loan Value Ratio (LVR) currently avaliable with the banks for non-SA resident borrowers?

I live in Australia, but would like to buy a ppty in Cape Town. I earn an annual salary equivalent to about R500,000.

Thanks

Joy Says:
June 20th, 2011 at 10:37 am

I want to buy a house..I don’t have a deposit. I can probably raise the Legal fees only. Who’s the best bond originators..

Paling Says:
June 22nd, 2011 at 4:36 pm

@ Andrew:

The risk to the bank is very high when lending to foreigners, they will only grant about 40-50% of the value.
So with your 500k salary you should be able to get a bond of about max 450k on a 900k property. Or borrow 400k on an 800k property, etc…
So at max debt you can buy a R900k property, and you’ll need R450k cash.

For foreign citizens it’s tough to buy in SA, for locals its actually quite easy and fairly uncomplicated.

andrew Says:
June 24th, 2011 at 1:20 pm

Hi Paling,

Thanks for that, appreciate the feedback.

What if you bought in partnership (effectively as co-borrowers on loan application), with a Cape Town local.

Could you get a higher lending % (effectively % available to locals) then?

Thanks,
Andrew

Hein Says:
July 14th, 2011 at 2:50 pm

Hi, I am currently a SA citizen but live in the UK. I came over straight from University so never worked in SA. What impact will this have on my credit score in SA (I still have a bank account, but rarely use it, as all my accounts are in the UK). Will I be able to qualify for a 100% Home Loan if I want to buy-to-let (BTL).

If not, what % deposit will I have to put down for BTL property? I will be a first time buyer, but not sure whether they still allow 100% loans for BTL properties.

Chantelle Says:
August 8th, 2011 at 3:12 pm

good day

Can you please hellp, i need a bond for R640 000, how do i qualify for that amount? please send me the details. we are first home owners that wants to buy a house,

hope to hear from you

thanks

Velma Gopie Says:
September 23rd, 2011 at 5:42 pm

I need a building bond of 2K urgently. Can I be helped.

Angela Sekete Says:
October 25th, 2011 at 10:14 am

Kindly assist me urgently, I need a bond for R350 000, how do i qualify for that amount? please send me the details. I am first home owner who wants to buy a house,

hope to hear from you soon.

Thanks

Kind regards
Angela

Dr.Wenta Says:
November 15th, 2011 at 11:03 am

Good day,
I am a reputable,legitimate,and an accredited money lender.i loan money out to individual and cooperate bodies in need of financial assistance.
Do you have a bad credit or are you in need of money to pay bills,LOAN to start up an investment,LOAN to buy cars,LOAN to do what pleases you? i want to use this medium to inform you that i render reliable beneficiary assistance as i will be glad to offer you LOAN at low interest rate which is 2%.if interested contact us via:pfisterwentaloanlender@gmail.com
Regards,
Dr.Wenta

Charles Says:
November 16th, 2011 at 1:13 pm

I have put in an offer for a house to be sold on auction. The actioneer gave me a Condition of sale document, which fnb will not accept when I applied for a bond, on my offer price. Are this a rules at all of our SA banks?

Louis Sangerhaus Says:
November 19th, 2011 at 8:56 am

Hi there.
If me and my wife wants to purchace a house,together and she have 2 judements on her name,it is paid of but stil shows on her credit check.Will we get a 100 percent bond.I have a clear record.

alluta Says:
January 10th, 2012 at 10:39 pm

hi
i have a situation here, im planning of buying a house through home loan as an investment in property and im currently not a home owner (still stay with my mother im 21 years)but now my family wants to move to another area and they want me to apply for a home loan

if i buy my parents house through home loan and then after we get the money we buy another house in other area, what are the risks to consider? things to take into consideration? and is it wise to do that,i dont have much information when it comes to buying a house im only 21 and most importantly im planning on investing on property so im quite concerned if it will not jeopardise my success in future purchase of property,
your advise will be highly appreciated

Kirsty Says:
January 11th, 2012 at 7:39 am

Hi, I am currently a temporary resident from the UK (not yet a SA Citizen). I live with my Boyfriend who is a SA Citizen and we would like to look at buying a property rather than wasting our money on renting. Is there any way we can do this as I believe we would need both our incomes to qualify but understand I will not be considered as a non Citizen.
Any advice you may have would be very much appreciated.
Thanks – Kirsty

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Nikhel Says:
November 23rd, 2009 at 12:04 pm
Hi, thank you very much for this piece of information, I am very glad go through this and this has been very useful to me. Thank you very much.
John Davies Says:
March 1st, 2010 at 10:53 pm
I need 100% mortagage in SA for buy to let residential or commercial property.

I’m not South African & I live in UK. My salary is > £50k per year.
Just wondering if this is feasible.

Willing to get advice via email re banks that offer such facilities and how I can go about it. Cheers
Gino S Says:
March 2nd, 2010 at 5:09 pm
Hi John, 100% mortgages are only currently available to South African citizens. Although, this ruling could change in the future.

I would suggest subscribing to our email newsletter if you’d like to receive a notice if/when this 100% bonds become available to foreign buyers.
Mimi Says:
May 5th, 2010 at 1:43 pm
Hi, I want to find out a person that earns a gross amount of R20526.50pm and a nett of R13372.48 pm, under normal circumstances, approximately how much bond would they qualify for? I know the Credit act applies and all the other expenses/credit are taken into consideration.

I’ll appreciate your assistance.
Paling Says:
May 20th, 2010 at 2:46 pm
Hi Mimi,

You will be allowed to commit up to 30% of your gross income to debt repayments.
If you are buying with someone else, that person’s gross income can be added to yours.
You also need to take into acount existing debt and those installments.
Your approximate max loan amount (under 14% interest rate conditions for safety’s sake) is then given by:

{(GrossIncome x 0.3) – ExistingDebtInstallments} x 80

E.g. if you’re buying on your own, and you’re paying R1200 per month on other debt, then

{(20526.50 x 0.3) – 1200} x 80
= { 6157.95 – 1200} x 80
= 4957.95 x 80
= R396,636.00 max allowable debt

This should give you a rough idea, work with +/- R50,000.00 on this. You can also Google for calculators.

Whether or not you’ll receive a bond for this much also depends heavily on the property value, how much you offered, and anticipated market movement (see my previous comment).
yuan prins Says:
August 21st, 2010 at 6:51 am
want to buy my parents house with a 2nd home on with an rental of R3000 per month for the next 5 years and at the moment I am paying R5000 rent for an mine house

house price R1050000 and the value is +- 1200000
Annelise Says:
February 1st, 2011 at 6:06 pm
I have not gone to the banks yet, but would like to buy a house as I think renting is a waste of money. Is the process really this difficult?

I surely dont have R75 000 laying around in my cupboard to pay for a deposit.
Elienah Says:
April 30th, 2011 at 1:05 pm
I’m with you on this Annelise. We spent a lot of money on rentals. we want to buy our own houses but with all these requirements and procedures we will probably be one of those unfortunate to own a house.
EDDIE MULLER Says:
June 6th, 2011 at 12:08 pm
Hi can you please help . Need a bond of R850 000.
andrew Says:
June 19th, 2011 at 11:42 am
Hello, what is max Loan Value Ratio (LVR) currently avaliable with the banks for non-SA resident borrowers?

I live in Australia, but would like to buy a ppty in Cape Town. I earn an annual salary equivalent to about R500,000.

Thanks
Joy Says:
June 20th, 2011 at 10:37 am
I want to buy a house..I don’t have a deposit. I can probably raise the Legal fees only. Who’s the best bond originators..
Paling Says:
June 22nd, 2011 at 4:36 pm
@ Andrew:

The risk to the bank is very high when lending to foreigners, they will only grant about 40-50% of the value.
So with your 500k salary you should be able to get a bond of about max 450k on a 900k property. Or borrow 400k on an 800k property, etc…
So at max debt you can buy a R900k property, and you’ll need R450k cash.

For foreign citizens it’s tough to buy in SA, for locals its actually quite easy and fairly uncomplicated.
andrew Says:
June 24th, 2011 at 1:20 pm
Hi Paling,

Thanks for that, appreciate the feedback.

What if you bought in partnership (effectively as co-borrowers on loan application), with a Cape Town local.

Could you get a higher lending % (effectively % available to locals) then?

Thanks,
Andrew
Hein Says:
July 14th, 2011 at 2:50 pm
Hi, I am currently a SA citizen but live in the UK. I came over straight from University so never worked in SA. What impact will this have on my credit score in SA (I still have a bank account, but rarely use it, as all my accounts are in the UK). Will I be able to qualify for a 100% Home Loan if I want to buy-to-let (BTL).

If not, what % deposit will I have to put down for BTL property? I will be a first time buyer, but not sure whether they still allow 100% loans for BTL properties.
Chantelle Says:
August 8th, 2011 at 3:12 pm
good day

Can you please hellp, i need a bond for R640 000, how do i qualify for that amount? please send me the details. we are first home owners that wants to buy a house,

hope to hear from you

thanks
Velma Gopie Says:
September 23rd, 2011 at 5:42 pm
I need a building bond of 2K urgently. Can I be helped.
Angela Sekete Says:
October 25th, 2011 at 10:14 am
Kindly assist me urgently, I need a bond for R350 000, how do i qualify for that amount? please send me the details. I am first home owner who wants to buy a house,

hope to hear from you soon.

Thanks

Kind regards
Angela
Dr.Wenta Says:
November 15th, 2011 at 11:03 am
Good day,
I am a reputable,legitimate,and an accredited money lender.i loan money out to individual and cooperate bodies in need of financial assistance.
Do you have a bad credit or are you in need of money to pay bills,LOAN to start up an investment,LOAN to buy cars,LOAN to do what pleases you? i want to use this medium to inform you that i render reliable beneficiary assistance as i will be glad to offer you LOAN at low interest rate which is 2%.if interested contact us via:pfisterwentaloanlender@gmail.com
Regards,
Dr.Wenta
Charles Says:
November 16th, 2011 at 1:13 pm
I have put in an offer for a house to be sold on auction. The actioneer gave me a Condition of sale document, which fnb will not accept when I applied for a bond, on my offer price. Are this a rules at all of our SA banks?
Louis Sangerhaus Says:
November 19th, 2011 at 8:56 am
Hi there.
If me and my wife wants to purchace a house,together and she have 2 judements on her name,it is paid of but stil shows on her credit check.Will we get a 100 percent bond.I have a clear record.
alluta Says:
January 10th, 2012 at 10:39 pm
hi
i have a situation here, im planning of buying a house through home loan as an investment in property and im currently not a home owner (still stay with my mother im 21 years)but now my family wants to move to another area and they want me to apply for a home loan

if i buy my parents house through home loan and then after we get the money we buy another house in other area, what are the risks to consider? things to take into consideration? and is it wise to do that,i dont have much information when it comes to buying a house im only 21 and most importantly im planning on investing on property so im quite concerned if it will not jeopardise my success in future purchase of property,
your advise will be highly appreciated
Kirsty Says:
January 11th, 2012 at 7:39 am
Hi, I am currently a temporary resident from the UK (not yet a SA Citizen). I live with my Boyfriend who is a SA Citizen and we would like to look at buying a property rather than wasting our money on renting. Is there any way we can do this as I believe we would need both our incomes to qualify but understand I will not be considered as a non Citizen.
Any advice you may have would be very much appreciated.
Thanks – Kirsty

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