Offer to purchase question

derp90 said:
So this is basically saying you must always have all your money in your bond access facility, and then take it out a day before your debit orders come off. Interesting, although I would have to set reminders to do that haha
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Its worth it in the end minimal effort max gain!
 
derp90 said:
If I understand correctly, having more money in your access facility of your bond, means that the daily interest calculation is less, because there's less amount owed for most of the month?
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thats correct.

Thats why my accounts except for the bond are ZERO 99% of the month
 
What would happen if you take lets say 100k from your CC and transfer it to your bond. Then after a month, take the 100k out of the bond and settle the CC in full and repeat every month
 
MidnightZA said:
What would happen if you take lets say 100k from your CC and transfer it to your bond. Then after a month, take the 100k out of the bond and settle the CC in full and repeat every month
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the moment money is EFTd out its seen as a cash withdrawal incurrs interest immediately.

My credit card interest is lower than bond so I can do it though :p

My bond is sub prime this is my cc interst

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Earlier last year
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MidnightZA said:
What would happen if you take lets say 100k from your CC and transfer it to your bond. Then after a month, take the 100k out of the bond and settle the CC in full and repeat every month
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Bad idea. Transferring cash out of your CC starts accruing interest immediately (i.e. does not benefit from the 55 days interest free) and generally your CC interest rate is higher than your bond rate so you'd end up paying more interest.
 
Jehosefat said:
Bad idea. Transferring cash out of your CC starts accruing interest immediately (i.e. does not benefit from the 55 days interest free) and generally your CC interest rate is higher than your bond rate so you'd end up paying more interest.
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That is the part I did not know about. I had a feeling there is no way that can work, else everyone would be doing it
 
If you get paid at the beginning of the month (for previous month), but it could be the 1st, could be the 2nd or 3rd etc. can you ask for your debit orders to come off just after your payment, say the 4th or 5th? Then you can transfer all the rest into your bond. Or are there set dates that debit orders have to come off?
 
Another question, I saw in some other thread that if the interest rate increases, instead of extra owing each month, they just extend your home loan further, so you'll pay more over a longer time? Is this how it works?!
 
derp90 said:
If you get paid at the beginning of the month (for previous month), but it could be the 1st, could be the 2nd or 3rd etc. can you ask for your debit orders to come off just after your payment, say the 4th or 5th? Then you can transfer all the rest into your bond. Or are there set dates that debit orders have to come off?
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I would suggest not playing with debit order dates. Just move your salary into you bond when you get paid.
 
derp90 said:
Another question, I saw in some other thread that if the interest rate increases, instead of extra owing each month, they just extend your home loan further, so you'll pay more over a longer time? Is this how it works?!
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This should be your VERY last option. And as soon as you can, increase your payment back to at least the equivalent of a 20year bond (or whatever period you had left).
Also know that with this option your monthly instalments are not a lot less but your interest amounts to a lot more. They normally offer 30year bonds instead of 20.
All banking sites have bond calculators. Play around and be shocked.
 
Quintrix said:
This should be your VERY last option. And as soon as you can, increase your payment back to at least the equivalent of a 20year bond (or whatever period you had left).
Also know that with this option your monthly instalments are not a lot less but your interest amounts to a lot more. They normally offer 30year bonds instead of 20.
All banking sites have bond calculators. Play around and be shocked.
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Wouldn't a 30 year bond offer a lower interest rate? And would it be beneficial to convert a 20 year to a 30 year with a lower rate? Especially if you planning on paying it off in 7 to 10 years?
 
Quintrix said:
This should be your VERY last option. And as soon as you can, increase your payment back to at least the equivalent of a 20year bond (or whatever period you had left).
Also know that with this option your monthly instalments are not a lot less but your interest amounts to a lot more. They normally offer 30year bonds instead of 20.
All banking sites have bond calculators. Play around and be shocked.
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I bought my first house... and started prepaying my bond with R500. Then the bug got me... then my salary at the end.

5 years later, my bond paid up.

Today, my debt is R1mil and 6 properties later with value of R11 000 000.

The biggest trick is a flexi bond! The power is awesome!
 
MidnightZA said:
Wouldn't a 30 year bond offer a lower interest rate? And would it be beneficial to convert a 20 year to a 30 year with a lower rate? Especially if you planning on paying it off in 7 to 10 years?
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I don't think so because banks will also wise up to the tricks the buyers use. But if they do offer lower then it is the best play if you intend paying of sooner.
 
maumau said:
Do you think a seller will come down from R1.45M to R1.3M for a cash offer?
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Its all how desperate the seller wants to sell!

Look at my last buy: valued at R1.8mil. I gave an offer of R1.2mil, and they said YES.

Try it. Its still a buyers market
 
maumau said:
Do you think a seller will come down from R1.45M to R1.3M for a cash offer?
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I think it will depend on other factors too. I.e. - is the place already well priced at R1.45m for the area and condition? Are there any other offers on the table? How desperate are the sellers?
 
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