Key truths about buying your first home
Buying your first home is one of the best things you can do for yourself and your loved ones. It's also one of the biggest things you'll ever buy. So, arming yourself with the right information upfront, can make all the difference.
We've put together a few key truths to give you an overview of what to expect. All of these sections are available in more detail in our home-buying guide.
Figuring out what you can afford. It helps to break down your budget into three parts: Upfront expenses, bond repayments, running costs. Bond repayments will be your main monthly expense, but also remember running costs (rates and taxes, levies if you're buying sectional title, utilities like water and electricity, insurance, fibre and more), and upfront expenses (transfer duty, transfer costs, bond registration costs, bond initiation fees, admin fees). Check out our Pre‑approval guide to find out more about getting pre‑approved and knowing exactly what you can buy for.
Finding the perfect place. As a general rule, you want to arm yourself with good-quality information, so it's a good idea to conduct a combined search - do your homework by looking online, but also consult a real estate agent who knows the area and type of property you're looking to buy. You'll probably discover they have invaluable information and advice to offer that you won't find online.
Making the offer that gets you the deal. Even if you've never negotiated anything big in your life, make sure you make an offer that wins the deal. To help you ace your offer to purchase, refer to our guide about Making an Offer.
Financing your first home. Avoid the biggest pitfall of first-home buyers: not shopping around for a home loan. This is not sales talk on our part - the numbers back it up. Getting a good interest rate on your home loan, which typically means a financial commitment of 20 years, could save you hundreds of thousands of rands over the term of your bond. Clearly not a saving to be ignored - think for a second what you could do with that money!
Owning and insuring your asset. Going through the conveyancing process with the various attorneys can be daunting. During this process there is a lot of unfamiliar jargon and paperwork, and the process takes about 3-4 months. This is also where you get your insurance in place for your new home. Our home-buying guide will help you make sense of this process and the parties involved. We will also help you get the best deal on your home insurance through our insurance brand, BetterSure.
With more than two decades' experience of making home loans happen for over 1 million South Africans, you have no need to feel overwhelmed! We're here to help you every step of the way.
Bond pre‑approval - your questions answered
For many people, the pre‑approval part of the bond process is not exactly common knowledge! So, we thought we'd provide you with the answers to questions we most often get asked about pre‑approval. It's worth getting good-quality information to guide you on your way to buying your first home. Here goes...
What exactly is a pre‑approval?
Simply put, we help you figure out whether you can afford a home loan or not! We take a close look at your finances and we do a quick credit check, with your consent.
If it all checks out, we give you a certificate stating the home loan amount you have been pre‑approved for. It tells agents and sellers you mean business and confirms what you can buy for.
How do you get pre‑approved?
- We verify your income and expenses to give you an accurate idea of the home loan you could apply for.
- We also do a quick credit check, which leaves no footprint, but gives you a good idea of your credit profile and whether you'll get approved for a home loan.
- You can also upload your documents to our easy-access online system, which is completely paperless - no scanning or emailing.
- Best of all, a pre‑approval doesn't cost you a cent.
What's the point of pre‑approval?
How many reasons would you like?! Here's a handful, to start off with!
It tells you exactly what you can afford.
It tells sellers and agents that you're serious about buying.
A pre‑approval certificate is valid for three months and lets you house-hunt with confidence because you know what you could buy for.
It puts you in pole position when you're ready to make an Offer to Purchase because you've been pre‑approved.
It speeds up your home loan application because you've already gotten your docs in a row!
These documents can also be used to apply for a home loan, if they're still current.
Do you need a pre‑approval to get a bond?
No, you don't. All you need to get a bond, apart from the documents listed above, is a signed OTP and we'll do the rest.
Been pre‑approved... now what?!
Once you've been pre‑approved and you've shopped for a home, you'll be in a position to sign an OTP. This is one of the most important steps of home-buying so find out all the facts and feel confident when the time comes. Three things to remember about an OTP:
- It's legally binding so don't commit to what you can't afford.
- Double-check that all details are correct.
- Clarify anything you're uncertain of.