Increase your chances of getting a home loan with these easy steps
There are a number of things you need to be aware of to improve your chances of getting your home loan approved
Getting a new home is one of the most exciting times in most people’s lives. Except for a lucky few most people will most likely to need financial assistance to make sure their dream of being a home owner are realised. Lenders have a criteria of what they are looking for before granting a home loan and doing the following can make you an attractive candidate.
Getting your credit in order
Jacques du Toit, Property Analyst at Absa Home Loans, says your credit record should be be sound both internal and externally.
Proving you are a good payer will also put you in a good light. Good Life Home Loans says it is not enough to pay your bills. Making sure they are paid on time will show lenders that you are not a high risk borrower. While it may seem negligible not paying your bills on time can make it appear like you are not on top of your financial obligations and are struggling to make ends meet.
Resist the urge to take on more debt
FNB warns that lenders will “continue to monitor their credit profiles and perform updated affordability checks up until bond registration.”
If your loan has been approved lenders can still reduce or even retract their there offer for a home loan if they find that you are increasing your debt load.
Tommy Nel, head of credit at FNB Home Loans, says: “We continually re-assess loans that we have approved in the window up until the bond registers in the Deeds Office and the property is transfer into the new owner’s name.”
Have a big deposit
Not only will having a sizeable deposit ensure that your overall monthly payments are lower it also shows that you are good at saving. du Toit says a person who has a deposit looks more attractive to lenders.
“That will definitely contribute to your [attractiveness as a client] in that you also share in the risk of this transaction with the bank,” he explains.
Your type of employment will also have an impact
Have a full-time stable job can increase your chances of getting a home loan. According to du Toit this is because being self-employed, working part time or working on commission means your income differs and can be volatile over time.
– Additional reporting: Good Life Home Loans