Loan for Transfer Fees

[marco79]

A friend of mine received bond approval for a house they made an OTP for.

They are about R50k short for the transfer fees. Their initial plans was either to apply for their shortfall from their pension or to take out a personal loan (as recommended by the bond originator).

To get funds released from a pension scheme will take 3 to 4 weeks so that isn't going to work anymore.

The bond originator now says that by applying for a personal loan now could jeopardize the transfer of the house going through onto their names at the deads office. Is this right?

When I purchased our 1st house I took out a personal loan of about 15% of the value of the property to pay for my deposit and fees.

 

[Rocket-Boy]

They are correct about taking additional debt having an influence on their bond.
The calculations on affordability are done around your current debt and financial situation. Taking on additional debt during that time can affect your affordability, especially if it was tight to begin with.

 

[The_Ogre]

Tell your friend to apply for an overdraft instead. That doesn't affect your creditworthiness according to how banks calculate your affordability.

It should, but it doesn't.

 

[Gtx Gaming]

Some overdrafts does not show up on credit record, so overdraft should work

 

[zerocool2009]

Dont mix friendship and money.... its always a disaster!

 

[quovadis]

Shows you why affordability calculations are so idiotic. Approved for a loan but can’t afford the cost of the bond registration/transfer without a loan. Should’ve applied for a 110% bond in that case to cover it originally.

 

[quovadis]

Tell your friend to apply for an overdraft instead. That doesn't affect your creditworthiness according to how banks calculate your affordability.

It should, but it doesn't.

The bank will most likely do an affordability assessment too for the overdraft facility and you wouldn’t want to conveniently omit an imminent new large expense.

 

[zerocool2009]

Shows you why affordability calculations are so idiotic. Approved for a loan but can’t afford the cost of the bond registration/transfer without a loan. Should’ve applied for a 110% bond in that case to cover it originally.

If you barely now qualify.... it rates go up by 4%... what then? Who will you blame when you cant pay anymore...