Home Loan/Bond Question

[essop1@gp]

Hi All,

Is there a process, when applying for a bond, to get extra monies out to settly small debt? For example, you qualify for R2million, you want to buy a property for R1.5mil, you need R100 000 to settle short term debt.
Almost like a consolidation of debt within the bond.
I know the value of the property plays a part in that, but can it, in some way or form be done.

Thanks

 

[ToxicBunny]

Hi All,

Is there a process, when applying for a bond, to get extra monies out to settly small debt? For example, you qualify for R2million, you want to buy a property for R1.5mil, you need R100 000 to settle short term debt.
Almost like a consolidation of debt within the bond.
I know the value of the property plays a part in that, but can it, in some way or form be done.

Thanks

They will bond to the value of the property... they will not bond beyond that.

 

[stricken]

You are lucky if you can even get 100% LTV... haven't seen 100%+ LTV in a long time.

 

[xrapidx]

Property will need to be worth at least R1,6m - more if you include fees, etc.

Its exactly what I did.

 

[essop1@gp]

Property will need to be worth at least R1,6m - more if you include fees, etc.

Its exactly what I did.

This is exactly what my thought process was, if the value of the property exceeds the actual selling price, its possible to do that.

Could i also possible do this, seller price R1.5m, evaluated price R1.55m, offer to purchase R1.4m.
If the offer is accepted as R1.4m, could i then still apply for the R1.55m, as is the evaluated price?

 

[xrapidx]

This is exactly what my thought process was, if the value of the property exceeds the actual selling price, its possible to do that.

Could i also possible do this, seller price R1.5m, evaluated price R1.55m, offer to purchase R1.4m.
If the offer is accepted as R1.4m, could i then still apply for the R1.55m, as is the evaluated price?

Yes, but its at the banks discretion to approve the loan - as mentioned, they might have issue with 100% loan to value.

 

[ToxicBunny]

This is exactly what my thought process was, if the value of the property exceeds the actual selling price, its possible to do that.

Could i also possible do this, seller price R1.5m, evaluated price R1.55m, offer to purchase R1.4m.
If the offer is accepted as R1.4m, could i then still apply for the R1.55m, as is the evaluated price?

You can try that...

Chances are though, the bank may approve the bond to that value but only approve the purchase price for the first year or two....

OR they might hit you with a higher interest rate etc etc...

 

[essop1@gp]

Yeah, i know the banks can basically structure it how they feel, with a little negotiation here and there. Nice to know that the option is there, other option is to buy the property and use the access finance option at some point. Think after a couple of years.

 

[F1 Fan]

You will be able to apply for an amount equivalent to the property value. So even if your purchase price is less, the difference is what is called a future use amount for building, improvements etc.