Few things to avoid during your home-buying process
Maxing out your Bond amount
There is more to homeownership than just your bond repayment, ie possible levies, maintenance costs, rates and taxes. Certain interest rates can hike during your bond term.
Buyers should try to stay within the price range which they initially budgeted for so that they can comfortably repay the total monthly home expenses that leaves them with extra left over.
Don’t let your credit score drop
Buyers should stay clear of applying for any additional accounts or credit cards, multiple enquiries will impair their credit scoring. Low credit score will negatively affect buyers chances of bond approval and if the buyer does get the loan the interest rate might be higher.
Ensure that payments is never late and all payments are made on time every month.
Where possible, buyers should attempt to get rid of existing debt, or at the very least reduce it to below 30% of the credit level.
Curb your spending splurges
Avoid making any large credit driven retail purchases before you apply for a bond, Spending big amounts of money on credit before applying for a bond will dramatically reduce a buyers chance of getting a bond.
Job changing
During your home buying process avoid interrupting stable employment as the lenders take the length of your employment into account when they process your bond application.
Borrowers with at least 6 to 12 months of employment are more likely to get the loan than of someone who is labeled as a credit risk due to job hopping.
Just because the bank is prepared to offer a certain bond amount to the buyer doesn’t mean they should buy a home for that amount.