Friday, June 12, 2009

100% Home Loans are Back!

Yes they are, but were they ever gone?

It was the headline news I saw on a lamppost yesterday of one of our leading local newspapers.

100% Home loans were never gone I thought to myself, but there are restrictions. I investigated and came to the conclusion that they were also talking about affordable housing.

I knew that these bonds had never disappeared, but it seems that most people didn't, and with that headline all home owners were thinking that they could now also get 100% home loans.

I'm sorry to say but that's not the case - unfortunately newspapers write headlines in such a way that you'll buy their paper.

100% home loans are only available for those buying in an affordable housing bracket.

What is affordable housing?

Affordable housing constitutes home purchases under R350 000

3 out of the 4 major lenders still grant 100% bonds in this segment of the market but some also have an income restriction.

Purchasers that qualify to buy in this market will still have to pay for their transfer fees and bond registration fees.

But no transfer duty is payable for a purchase price under R500 000

If you just asked yourself that question you would be correct.

But if you look closely I said transfer fees, not transfer duty.

Transfer duty to SARS is exempt for purchases under R500 000, but there is still a transfer fee payable to the attorney to do the transfer of the property.

If you want to know more about home loans, how much you qualify for or what all the costs involved would be, please go to: http://www.gpfmortgage.co.za for more information.