It is true that real estate prices have seen a big boom in the past couple of years. However, if you have a stable job and earn a regular salary, it wouldn’t be much of a problem for you to secure a home loan. This article here states some simple ways by which you can have your home loan approved even if you do not earn a very high salary.
Do not miss on special home loan offers
If you have decided to buy a home, be on the lookout for any special offer that is made by the banks or financial institutions. Banks operating in South Africa always have something or the other going on in the home loan segments, and these could prove to be real beneficial to you. The financial institutions also have some extra packages for people who are buying their first homes. These are done keeping in mind that some of the people who are first time prospective house buyers may not be earning a very handsome salary or they would not be having sufficient amount of cash ready for the down payment. However, once you have found the right deal for yourself, try negotiating with the bank about the interest rate. Even if they agree to lower the rates by just some points, this could still make a lot of difference when you start paying your monthly repayments. This can be very helpful if you live on a limited budget.
Also, if you have hired a real estate agent to look for a house, do not just settle for the first offer that he or she suggests. Remember, these agents tend to keep a large cut from the sale price, so the more you bargain, the more you can save. Another fact that needs to be mentioned here is that cheaper estates do not always advertise. You will have to drive around yourself on weekends and on holidays to search for these properties.
Increasing your loan term
If you plan on increasing the tenure of your loan period, you could request for a bigger loan from the bank, and this could mean that you can buy the house that you have always dreamed about. Furthermore, if the period of the loan is increased, you will have more time to repay the loan and you will also have to shell out lower interest. However, the only disadvantage would that the house will probably cost you much more than its real value.
Joint home loans
Joint home loan is a combined venture by two partners to buy a house, or in this case, to secure a home loan. This is one of the best ways to secure a home loan if your individual earnings do not qualify you for a loan from the bank. When you request for a combined home loan, the banks calculate the gross salary of both the applicants and if found okay, they sanction the loan. However, appropriate caution ha to be exercised here. Remember to get everything, from the monthly repayment plans to the dividends when the house is sold in future, on a legal agreement.
Minimize your risks – start with lower value homes
This is considered to be one of the most common mistakes that is committed by people who buy their first homes. They intend to buy the house of their dreams, and thus apply for a huge loan amount which takes them years to repay. One should start with a reasonable house, and then with gradual increase in time, experience and earnings, move on to bigger dreams.