SA HOME LOAN NEWS: ABSA Mortgages
In what looks like an effect to improve their Mortgage Product offerings before the launch of Virgin Home Loans and retain its dominant slice of the R600bn Bond market, ABSA has announced some interesting Home Loan Benefits.
Top of the list of new Home Loan benefits is the 12 Month Fix Rate option.
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Interestingly, less than 5% of all home loan accounts in South Africa are fixed. Itâ€™s no hard to understand why there are so few Fixed Rate mortgages currently when you consider that the average fixed rate is about 1% ABOVE Prime.
Since most homeowners are currently enjoying a rate of 1.5% Below Prime, interest rates would have to increase by 2.5% before youâ€™d begin to benefit from a fixed rate.
ABSA has recently introduced a 12 month Fixed Rate option, which allows you to fix you bond at PRIME â€“ 1% less than an average fixed rate.
This initiative is offer new and existing SA Homeowners an opportunity to fix their monthly mortgage repayments for one year at a relatively low rate during a period of rising interest rates.
Donâ€™t have an ABSA HOME LOAN? Switch now and you save on costs.
It is said that a â€œgentlemenâ€™s agreementâ€ exists between the Four Big Banks not to actively promote Home Loan Switching.
ABSA has seemed to have broken this agreement when the bank announced it is now offering to pay the transfer costs of clients that switch home loans from other banks.
If mortgage switching continues to increase the Banks would be forced to lower their average interest rates or face loosing their customers to rival Home Loan providers.
Take advantage of this innovative offering, Click here to Speak to a consultant now about Switching or Fixing your home loan rate.