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Absa Home Loans
Buying property is probably the biggest investment you will ever make. A home loan is a long-term commitment and therefor it is very important that you make the right, informed decisions.
With ABSA it doesn’t matter if you are building your own home or buying an already established home. ABSA will help you with your investment in the property market.
Documentation required when you apply for an ABSA Home Loan:
- A fully completed and signed home loan application form
- A copy of our SA identity document or Passport as proof of your identity
- You latest pay slip or proof of your income
- A copy of the Offer to Purchase, including the property details
- When commission is received or you are not yet an ABSA customer, you must also have copies of the last 6 months’ bank statements where your income is reflected and the last 3 months must be consecutive
What Home Loan amount will you qualify for?
You are generally allowed to use about 30% of your income for home loan installments. These installments exclude your home insurance amount. Deduct all your monthly expenses from your monthly earnings. Your monthly earnings should include any housing subsidies. The amount that you are left with, is the amount you can afford to put towards a home loan repayment.
ABSA Home Loans
ABSA Home Loans enable you to finance residential property and also includes vacant land. This Home Loan can be adapted to suit your personal needs and requirements by adding various features and options to it.
Features of ABSA Home Loans:
- 100% loan to the purchase price
- Repayment term can be maximized to 30 years
- The repayment term can be increased or decreased
- You can choose between a fixed or variable interest rate option
- You can have electronic access to your home loan by linking it to ABSA’s Internet Banking or Telephone Banking.
- You can apply for a further loan as soon as your property’s value have increased or you want to improve the value of your property
- You have the option to make any additional payments to your home loan account, by doing this you will reduce your interest cost immediately.
- With ABSA’s FlexiReserve you can have immediate access to the additional money you paid into your Home Loan account.
- You can purchase more than one property and link them to only one home loan account with ABSA.
Some of the Options Available from ABSA Home Loans
1. ABSA First-Time Home Loan
For ABSA’s first-time homebuyers only one home loan is granted but the account is split up between the cost portion and the purchase price. Keep in mind that a shorter period for repaying your additional purchasing cost will mean paying less interest on the amount for transfer and registration costs.
The criteria that applies to the ABSA First-Time Home Loan include:
- You must be a first-time homebuyer
- You must have a reliable and regular income
- The minimum amount for a home loan is R120 000
- You must have suitable life cover
Benefits of ABSA First-Time Home Loans:
- You don’t need cash to pay for your registration or transfer fees
- You get easy access to the property market
- You can save a lot of money by paying the cost portion of your account off quicker
- The account structure is flexible and you can structure each account uniquely with its own term and interest rate (fixed or variable)
2. ABSA MyHome Home Loan
ABSA has introduced this new option that is suited to those who earn R7500 or less per month. This is a 100% home loan that covers the total purchase price of the property.
The criteria that applies to the ABSA MyHome Home Loan include:
- A single or joint income of less than R7500.00 per month
- Be a South African citizen
- Showing proof of a regular income
- Life cover that comprises death and permanent disability is required.
Benefits of ABSA MyHome Home Loans:
- No deposit is required
- You can choose the repayment period that best suits your financial situation
- The repayment amount stays the same for the period you have selected
- You can take out ABSA House Owners Comprehensive Insurance and save on your monthly service fees.
3. ABSA Building Loan
When you can not find a suitable home you feel like purchasing, ABSA’s Building Loan is the option for you. When you apply for a building loan you should keep in mind that you need to be very specific. You need to specify exactly what types of finishes you are going to use and this must be put into a formal contract. You and the builder must sign this contract. In the tender the builder should also state whether the contract price is subject to escalation and the rate of escalation should also be stated clearly.
The criteria that applies to the ABSA Building Loan include:
- The qualifying criteria applicable to an ABSA Home Loan will also apply to the Building Loan
Unique costs to building a home:
- Drawing of the building plans
- Fees to approve your building plans
- Local authority rates and taxes must be paid during the building period, even if the land is still vacant.
- Interim interest
Supporting documentation required for a Building Loan:
- A standard ABSA form needs to be signed (Minimum specifications)
- A copy of the Provisional Plans or Sketch Plans
- A detailed quote or tender from the builder or developer
- A schedule of Finishes
- Waiver of Builder’s Lien
An ABSA assessor will assess your stand and the costs to complete the building of your house. He also checks to make sure the builder you are going to use is registered with the NHBRC (National Home Builders Registration Council) If everything seems secure and safe, the maximum home loan will be granted.
The options mentioned above are only a few options available from ABSA. Homebuyers can further experience the flexibility of ABSA Home Loans by making use of their home loan to finance any renovations or home improvements to their existing property.
