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Cape Town - With the residential property market reflecting positive market sentiment, many estate agents, bond originators or home finance experts are in a much better position to help buyers manage affordability than ever before, according to Manja Kritzinger, CEO of Realtors International.
“Homebuyers are —rightly so – more prudent today. A bank’s lending criteria is one thing, but homebuyers should have a finer understanding of their personal cash flows, circumstances and views of the future," said Kritzinger.
"For example, more consumers are having to make a choice between buying a home or upscaling their vehicle. It also makes sense to base affordability calculations on an interest rate 3% higher than the rate offered.”
Kritzinger urged homebuyers to get a prequalified loan certificate and credit report from home finance experts, who will conduct a full income and expenditure assessment and run a credit bureau enquiry to ascertain the buyers risk profile.
“Homebuyers should embrace the opportunity to understand their credit position as this puts them in charge of the situation when applying for home finance," she said.
One scenario is having a clear credit record, but insufficient net surplus income.
"This is not the end of the world. You’d then either look for a home with a reduced purchase price or look to consolidate or restructure debt to secure a positive net surplus income,” said Kritzinger.
Another scenario is where a homebuyer has a positive net surplus income, but a poor credit record.
In this instance, the answer could involve some form of credit rehabilitation before buying.
Kritzinger said the structuring of debt by specialists — especially unsecured debt such as credit cards, retail cards and personal loans — can yield significant monthly savings.
It can prove the difference between getting home finance at all and buying that dream home without draining your cash flow.
- Fin24
Help us help you by taking our second annual Debt survey and you could win R3 000, or add your voice by sharing your debt experiences, debt-busting tips and insights.
“Homebuyers are —rightly so – more prudent today. A bank’s lending criteria is one thing, but homebuyers should have a finer understanding of their personal cash flows, circumstances and views of the future," said Kritzinger.
"For example, more consumers are having to make a choice between buying a home or upscaling their vehicle. It also makes sense to base affordability calculations on an interest rate 3% higher than the rate offered.”
Kritzinger urged homebuyers to get a prequalified loan certificate and credit report from home finance experts, who will conduct a full income and expenditure assessment and run a credit bureau enquiry to ascertain the buyers risk profile.
“Homebuyers should embrace the opportunity to understand their credit position as this puts them in charge of the situation when applying for home finance," she said.
One scenario is having a clear credit record, but insufficient net surplus income.
"This is not the end of the world. You’d then either look for a home with a reduced purchase price or look to consolidate or restructure debt to secure a positive net surplus income,” said Kritzinger.
Another scenario is where a homebuyer has a positive net surplus income, but a poor credit record.
In this instance, the answer could involve some form of credit rehabilitation before buying.
Kritzinger said the structuring of debt by specialists — especially unsecured debt such as credit cards, retail cards and personal loans — can yield significant monthly savings.
It can prove the difference between getting home finance at all and buying that dream home without draining your cash flow.
- Fin24
Help us help you by taking our second annual Debt survey and you could win R3 000, or add your voice by sharing your debt experiences, debt-busting tips and insights.
