Home Loan Tips: Switching home loans
Switching Home Loans particularly relates to homeowners who have had their mortgages for at least 6-months. The term refers to the process of switching your current home loan account from one bank to another.
Although many homeowners are totally unaware that this option is available to them, Home Loan Switching is a growing trend in South Africa. Customers are starting to realize the potential of switching their home loans to another bank.
Advantages of Switching Homeloans
- The most obvious reason to switch your bond is the possibility of getting a lower interest rate from another bank. If your current bank is not prepared to give you a discounted rate on your mortgage, and another bank is willing to do so, then it may well be worthwhile switching. The difference in your homeloan interest rate can add up to a considerable amount of money over the period of the loan.
- As the number of home loan providers continues to increase, banks are having the rethink their approach to home loans. To attract new customers many banks will offer you additional banking features and benefits for simply switching over.
Also, the types of home loan products differ quite a bit and you may need to switch your home loan to a bank that is able to give you an account that better suits your needs. It’s best to consult with a bond originator to get a better idea of the mortgage products offered at the different banks. - Another reason to switch is, if your property value has increase dramatically since you bought it – you will be eligible for a larger loan or even a second bond. You will be able to decide how much you would like to borrow during the switching process.
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