Leaving bond open

S

shadow_man

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I'm in the position where I'm finally able to settle my first bond.

I've grabbed the settlement letter and can settle the amount.

This results in the bond being cleared, but the deed remaining with the bank (as the bond acc isn't closed until you further request it).

I understand that I'll keep getting charged the monthly service fee for the account, but my question is more along the lines of how I borrow against this account later if needed (how much will they provide? Is it based off what the amount owing would typically be at that point in the term?).

Additionally does this bond account being "open" (but paid off) affect my ability to get future finance in any way? e.g. Would a new financial institution see you've got an open bond and possibly refuse finance or provide it at a higher rate as a result?
 
shadow_man said:
I'm in the position where I'm finally able to settle my first bond.

I've grabbed the settlement letter and can settle the amount.

This results in the bond being cleared, but the deed remaining with the bank (as the bond acc isn't closed until you further request it).

I understand that I'll keep getting charged the monthly service fee for the account, but my question is more along the lines of how I borrow against this account later if needed (how much will they provide? Is it based off what the amount owing would typically be at that point in the term?).

Additionally does this bond account being "open" (but paid off) affect my ability to get future finance in any way? e.g. Would a new financial institution see you've got an open bond and possibly refuse finance or provide it at a higher rate as a result?
Click to expand...
@zerocool2009 best person to assist
 
shadow_man said:
I'm in the position where I'm finally able to settle my first bond.

I've grabbed the settlement letter and can settle the amount.

This results in the bond being cleared, but the deed remaining with the bank (as the bond acc isn't closed until you further request it).

I understand that I'll keep getting charged the monthly service fee for the account, but my question is more along the lines of how I borrow against this account later if needed (how much will they provide? Is it based off what the amount owing would typically be at that point in the term?).

Additionally does this bond account being "open" (but paid off) affect my ability to get future finance in any way? e.g. Would a new financial institution see you've got an open bond and possibly refuse finance or provide it at a higher rate as a result?
Click to expand...

Firstly, congrats on paying off your first bond. Its alot of work and dedication.

You pay interest on the amount you owe per month (as the certain rate the bank gave you).

I assume you have a flexi bond (access bond in other words).

Your question 1 : How do you borrow against that ? Its like any other account (if you have the flexi option enabled). I see it as a piggy bank, or savings account. You can login, EFT money out as needed and use it.

Remember, a paid up bond, or actually ANY bond, its a vehicle that can be used to purchase a new car, another property if you want. A holiday, funding your kids education, you name it. So always remember, a flexi bond is powerful, and its power in your hands, not the banks (as the bank fund it).

An open bond can be viewed by ANY bank, or any firm pulling your credit scoring, as banks list whats borrowed.

Personally, that doesnt affect you much. It only mean, you have Rxxx amount available if you need money.

As you said, the service fee is standard. And that will continue per normal. As in my case, I have a paid up bond since 2009, and its R0. And I stil pay the service fee.

Something to REMEMBER, if the bond is dormant, it gets into a dormant stage after a few months and years, and if you need to move money out (that might CRASH / error out). In that case, just call the bank (as in homeloans and say you want to enable the bond again as its in a dormant stage).

Each bond is unique, as per your own credit scoring. A good example, a good friend of mine bought a house now, with FNB for years. FNB gave him prime. He went to Standard Bank and they offered him prime less 1.2%. So for a bond, please dont be loyal, dont beg.

If you want more info into buying more property and the perks about SARS (PM) me please. I am here to help and if you have more questions, post it on this thread and will gladly answer what I can and know ;)
 
Was gonna say a wall of text incoming. Hahahaha
Snyper564 said:
@zerocool2009 best person to assist
Click to expand...

zerocool2009 said:
Firstly, congrats on paying off your first bond. Its alot of work and dedication.

You pay interest on the amount you owe per month (as the certain rate the bank gave you).

I assume you have a flexi bond (access bond in other words).

Your question 1 : How do you borrow against that ? Its like any other account (if you have the flexi option enabled). I see it as a piggy bank, or savings account. You can login, EFT money out as needed and use it.

Remember, a paid up bond, or actually ANY bond, its a vehicle that can be used to purchase a new car, another property if you want. A holiday, funding your kids education, you name it. So always remember, a flexi bond is powerful, and its power in your hands, not the banks (as the bank fund it).

An open bond can be viewed by ANY bank, or any firm pulling your credit scoring, as banks list whats borrowed.

Personally, that doesnt affect you much. It only mean, you have Rxxx amount available if you need money.

As you said, the service fee is standard. And that will continue per normal. As in my case, I have a paid up bond since 2009, and its R0. And I stil pay the service fee.

Something to REMEMBER, if the bond is dormant, it gets into a dormant stage after a few months and years, and if you need to move money out (that might CRASH / error out). In that case, just call the bank (as in homeloans and say you want to enable the bond again as its in a dormant stage).

Each bond is unique, as per your own credit scoring. A good example, a good friend of mine bought a house now, with FNB for years. FNB gave him prime. He went to Standard Bank and they offered him prime less 1.2%. So for a bond, please dont be loyal, dont beg.

If you want more info into buying more property and the perks about SARS (PM) me please. I am here to help and if you have more questions, post it on this thread and will gladly answer what I can and know ;)
Click to expand...
 
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