applying for your bond make sure you fight for the best interest rate
available. Banks will not offer you discount up front and you will be
at how quickly you could score another half a percentage if you fought
difference of even half a percentage point can make a huge difference
much you pay over the life of a loan. For example, the difference in
monthly payment on a R700,000 mortgage at 8 percent vs. 7.5 percent is
per month. Over 30 years, that's R88,200.
the repayment calculator tables to do the sums for yourself.
INTEREST RATE OPTION
interest rate is a fluctuating rate based on the prime lending rate, as
set by the
bank from time to time. You are able to negotiate a potential
concession with your
bank. If interest rates change, so does your monthly repayment.
the features and benefits of the Variable Interest Rate option?
the Variable Home Loan Interest Rate option?
interest rate is individually determined, based on your personal and
- You can switch from this rate option to
another rate option at any time.
- This rate
option cannot be fixed for a predetermined period.
- Fluctuations in the prime lending rate
affect the interest charged and the
monthly repayments on loans using this interest rate option.
INTEREST RATE OPTION
believe that interest rates will be reducing in the short to medium
- You have sufficient disposable income to
handle variations in your repayment.
Example: The monthly repayment on a home loan amount of R400 000 if
over a 20-year period: At 13%
= R4 686.00 | At 14% = R4 974.08 | At 15% = R5 267.16
interest rate is an agreed upon interest rate that is fixed (does not
over a pre-determined period of time (term). Please note that the fixed
option is contracted for a specific term and, after this term, will
to the prime lending rate, a variable interest rate, unless you opt to
the fixed rate option at the time of renegotiating.
the features and benefits of the Fixed Interest Home Loan Rate
regarding what your repayments will be for the specified period.
- Protection against upward movements in the
prime lending rate.
- The fixed
rate option may not be terminated prior to the expiry of the agreement.
- The variable interest rate option or
another fixed rate option can be applied
once the fixed rate option expires.
the Fixed Home Loan Interest Rate option?
- You prefer
regular payments with no surprises.
- You have a limited or fixed income.
- You plan
to stay in the home for a long time.
- You want protection from rising interest
are refinancing at a time when interest rates are comparatively low.
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