When the banks consider granting home loans for foreigners, they will typically categorize their clients into two major groups. Those living and working within SA borders, and those who are wanting to buy a property in South Africa but living or working abroad or outside of South African Borders.
Foreign Buyers Not Living Or Working In SA
All of the banks will presently consider financing only up to 50% of a property’s price for those foreigners who are not presently living and working in SA.
This restriction has been largely set by the South African Reserve Bank (SARB), who controls the flow of money in and out of the country, and manages the funding pool of all the major banks.
Foreign Buyers Living And Working In South Africa
For the rest of this guide we’ll consider what the home loan requirements are for Foreign Nationals. Foreigners who are permanently employed and living in South Africa, and seeking to secure property finance are also referred to as Foreign Nationals.
Let’s start with the basic documentation required for a foreign national to apply for a home loan. As you might expect, the documentation required by the banks are quiet extensive.
The bank is really trying to reduce the risk of investing in you, buy ensuring that you are able to meet the minimum requirements of this home loan for an extended period of time.
Below is a list of some documentation needed:
- A renewable employment contract confirming permanent employment, valid for a minimum period of 12 months
- A copy of an endorsed work permit or visa, valid for a minimum period of 2 years
- Recent payslips confirming monthly gross and net income
- 3 months local bank statements reflecting salary deposits
- A recent letter from the employer confirming any additional benefits of employment.
The documents required will need to verify sustainable employment and security for the applicant. This means that when the bank assesses the application there has to be sufficient proof of employment stability and a track record which clearly indicates evidence of affordability for the requested home loan.
In the case where a special skills’ permit has been issued, or the applicant is highly qualified for the position there is even further merit added to motivate for the home loan approval.
Which Bank Will Offer You The Best Deal?
Presently, ABSA home loans offers up to 90% of property prices for foreign nationals, which is subject to certain lending criteria being met. One of their major requirements is to reflect at least 6 months’ of salary deposits into an active Absa bank account prior to applying for the home loan. This will help to build a bank risk score and contribute favourably towards an approval for finance.
The rest of the major banks would only consider maximum loan ratios between 50% and 80%, this will be decided upon each individual’s merit and relationship with the bank at the time of applying.
Get More Assistance Online
In order to ensure that your application receives the best outcome and is assessed favourably, it is highly recommended to appoint a bond originator to setup your home loan application.
Your application would be pre-assessed at no additional cost to you. Our consultants are highly skilled in this process and will be happy to guide you in the right direction. We look forward to hearing from you.