Offer to purchase question

[zerocool2009]

Applying for a bond at the same bank, personal vs MO, personal would beat it (my honest view). Its a bit of admin, but worth while.

I know nedbank and fnb have great perks going direct.

But if you choose a MO, let them do your admin.

 

[Scooby_Doo]

Applying for a bond at the same bank, personal vs MO, personal would beat it (my honest view). Its a bit of admin, but worth while.

I know nedbank and fnb have great perks going direct.

But if you choose a MO, let them do your admin.

Perks?

 

[zerocool2009]

Perks?

If the banks pays a huge % of your bond costs or 50% back in rewards of the first debit order.

It all adds up ....

 

[RonSwanson]

If the banks pays a huge % of your bond costs or 50% back in rewards of the first debit order.

It all adds up ....

Not only that, the banks don't have to pay the bond/mortgage originator a commission.
Plus you get a chance to negotiate a rate face to face with the bank/s.

It's as you say, people are generally lazy, like sheep, and it ostensibly appears to be too much trouble to fill in the forms at 4-5 banks, so they go to a bond originator. Somehow they are convinced and believe that the bond originator has their best interest at heart.

Nothing could be further from the truth, the bond originator works for themselves, first and foremost. They are an intermediary, they "wet their suckers" in a direct ratio to the amount of business that they commit to bringing in to the bank. So at the outset, before any sheep apply for a loan, the deck is already loaded, the pap has been eaten, the embers of the fire have died down, and the (stuffed) piggies and leeches are slumbering.

The bond originator needs to meet their quota, so the next step is for the leech to convince the sheep that they are the good guys, that they will "fight" for the best interest rate for them. They don't tell the sheep the truth: that they have a long-term working relationship with all of the piggies (who run the banks), based on their performance, that spans many years. Their relationship with the sheep is short term by comparison. It isn't in their best interest to "fight" with the piggies at the bank, because these are the same piggies that feed them.

The leeches convince the sheep that it is better to deal with them. Their value proposition is based on the lazy nature of the sheep, the sheep buys into the leech's business model, primarily because the sheep is far too lazy to fill out a 4 page form for each piggy (and submit the countless evidences, which are actually all the same).

Practically speaking, the model is flawed from the outset, just like BBBEE. An intermediary (or intermediaries / leeches) who actually add next to zero value to the procurement process, convince the sheep that it is in their best interests to use their "services" and once convinced, can wet their suckers a few times and then move on to their next victim. Welcome to the parasitic world of bond / mortgage originators!

 

[Speedster]

Not only that, the banks don't have to pay the bond/mortgage originator a commission.
Plus you get a chance to negotiate a rate face to face with the bank/s.

It's as you say, people are generally lazy, like sheep, and it ostensibly appears to be too much trouble to fill in the forms at 4-5 banks, so they go to a bond originator. Somehow they are convinced and believe that the bond originator has their best interest at heart.

Nothing could be further from the truth, the bond originator works for themselves, first and foremost. They are an intermediary, they "wet their suckers" in a direct ratio to the amount of business that they commit to bringing in to the bank. So at the outset, before any sheep apply for a loan, the deck is already loaded, the pap has been eaten, the embers of the fire have died down, and the (stuffed) piggies and leeches are slumbering.

The bond originator needs to meet their quota, so the next step is for the leech to convince the sheep that they are the good guys, that they will "fight" for the best interest rate for them. They don't tell the sheep the truth: that they have a long-term working relationship with all of the piggies (who run the banks), based on their performance, that spans many years. Their relationship with the sheep is short term by comparison. It isn't in their best interest to "fight" with the piggies at the bank, because these are the same piggies that feed them.

The leeches convince the sheep that it is better to deal with them. Their value proposition is based on the lazy nature of the sheep, the sheep buys into the leech's business model, primarily because the sheep is far too lazy to fill out a 4 page form for each piggy (and submit the countless evidences, which are actually all the same).

Practically speaking, the model is flawed from the outset, just like BBBEE. An intermediary (or intermediaries / leeches) who actually add next to zero value to the procurement process, convince the sheep that it is in their best interests to use their "services" and once convinced, can wet their suckers a few times and then move on to their next victim. Welcome to the parasitic world of bond / mortgage originators!

The bond originator also knows how to package your application best. Mine helped me to improve my credit score and available monthly funds by recommending one or two small changes. Ended up with a bigger bond then I would have qualified for at much better rate than if I had gone it alone.

 

[RonSwanson]

The bond originator also knows how to package your application best. Mine helped me to improve my credit score and available monthly funds by recommending one or two small changes. Ended up with a bigger bond then I would have qualified for at much better rate than if I had gone it alone.

Improving a credit score isn't a complicated matter, credit bureaus offer this information quite freely and publicly. To me, the value of receiving such information from an intermediary does not justify their use.

I am happy that it worked out well for you though.

 

[Speedster]

Improving a credit score isn't a complicated matter, credit bureaus offer this information quite freely and publicly. To me, the value of receiving such information from an intermediary does not justify their use.

I am happy that it worked out well for you though.

I'm yet to have a credit bureau give me detailed instruction on which account to pay off or decrease the limit (even temporarily) or adjust my car loan etc for a higher credit application.

 

[RonSwanson]

@RonSwanson 's How to improve credit score​

How Can I Increase My Credit Score? - Experian

You can improve your credit scores by bringing any past due accounts current, making all payments on time, and paying down credit card balances.

www.experian.com

Five Simple Steps Toward Better Credit

What are 5 simple steps to get better credit score? The first step towards better credit management is to see a clear picture of your credit profile.

www.transunion.com

Ultimate Credit Score Guide - 2020

Ultimate credit score Guide - 2020. An in-depth article on credit scores with the 4 bureaus

creditsalvage.co.za

There many more. Common to all:

• Pay all your bills on time
• Reduce outstanding credit card debt
• Pay off multiple small accounts

No brainers (should be common sense);

• Ensure that your bond payment together with all other monthly credit payments do not exceed 30% of gross income on your application
• Cancel ridiculously unnecessary ones (like clothing store accounts and DSTV) and then use that money it to pay extra into other credit accounts
• Pay any credit exactly when it is due, not 10-20 days before unless you are getting a discount on interest or behind in payments
• Reduce the amount of credit needed for a bond by increasing the deposit
• Reduce monthly expenses and then use that money it to pay extra into monthly accounts to reduce them
• Live within your means, not your friends, and not anyone else's.
• Don't overcapitalise on home improvements. Have the worst house in the best area.
• Don't pimp your ride. Snazzy rims / fake air scoops / spoliers / wraps / fat exhausts / lowered suspension / luxury seat covers / mats do not add value. It's OK to drive the stock model, a Polo remains a Polo.
• It's OK to drive a smaller second hand car vs a sparkling brand new performance / luxury one, apart from payment reduction you'll save on insurance premiums, fuel and fines as well
• It's OK to take bacon, lettuce and tomato sarmies to work vs eating takeaways. Bacon sarmies are delicious.
• Avoid going to the shops every day. Make a list, stick to it and go weekly. Buy wholesome food, like protein . Avoid any processed meat / food and above all, skimmed milk
• Look after and maintain your important stuff. Regular maintenance trumps repairs / replacement
• Brew your own beer
• "Investing" money into any policy, stock, bond or cryptocurrency is craziness if you have any outstanding debt (even a bond)
• Use the extra money in your bond to pay off that car loan / credit card / account with a higher interest rate
• Review and examine all those hundreds of "small" monthly bloodsucking leech expenses that are each under, say R300 per month. How many of them do you really need, how many can you cancel?
  

 

[Speedster]

@RonSwanson 's How to improve credit score​

How Can I Increase My Credit Score? - Experian

You can improve your credit scores by bringing any past due accounts current, making all payments on time, and paying down credit card balances.

www.experian.com

Five Simple Steps Toward Better Credit

What are 5 simple steps to get better credit score? The first step towards better credit management is to see a clear picture of your credit profile.

www.transunion.com

Ultimate Credit Score Guide - 2020

Ultimate credit score Guide - 2020. An in-depth article on credit scores with the 4 bureaus

creditsalvage.co.za

There many more. Common to all:

• Pay all your bills on time
• Reduce outstanding credit card debt
• Pay off multiple small accounts

No brainers (should be common sense);

• Ensure that your bond payment together with all other monthly credit payments do not exceed 30% of gross income on your application
• Cancel ridiculously unnecessary ones (like clothing store accounts and DSTV) and then use that money it to pay extra into other credit accounts
• Pay any credit exactly when it is due, not 10-20 days before unless you are getting a discount on interest or behind in payments
• Reduce the amount of credit needed for a bond by increasing the deposit
• Reduce monthly expenses and then use that money it to pay extra into monthly accounts to reduce them
• Live within your means, not your friends, and not anyone else's.
• Don't overcapitalise on home improvements. Have the worst house in the best area.
• Don't pimp your ride. Snazzy rims / fake air scoops / spoliers / wraps / fat exhausts / lowered suspension / luxury seat covers / mats do not add value. It's OK to drive the stock model, a Polo remains a Polo.
• It's OK to drive a smaller second hand car vs a sparkling brand new performance / luxury one, apart from payment reduction you'll save on insurance premiums, fuel and fines as well
• It's OK to take bacon, lettuce and tomato sarmies to work vs eating takeaways. Bacon sarmies are delicious.
• Avoid going to the shops every day. Make a list, stick to it and go weekly. Buy wholesome food, like protein . Avoid any processed meat / food and above all, skimmed milk
• Look after and maintain your important stuff. Regular maintenance trumps repairs / replacement
• Brew your own beer
• "Investing" money into any policy, stock, bond or cryptocurrency is craziness if you have any outstanding debt (even a bond)
• Use the extra money in your bond to pay off that car loan / credit card / account with a higher interest rate
• Review and examine all those hundreds of "small" monthly bloodsucking leech expenses that are each under, say R300 per month. How many of them do you really need, how many can you cancel?
  

Those are all standard practice. What they don't say is how much, for example, paying an extra R10k in on your car loan or adjusting your credit card usage will affect your loan qualification amount.

 

[kiepie]

We have been in the market for nearly 6 months looking for a property, looking at relocating provinces.

We have finally found something that we can see ourselves in for the next 15 years. I mentioned to the estate agent that we are willing to offer 7.5% less (we did a lot of due diligence on the area).

The agent is adamant that the seller will take our offer more serious if we sign the OTP and then take the offer forward. For now we would prefer the seller giving us a verbal "yes we are okay with the lower offer".

We are happy to proceed at the lower offer and sign, but we have other questions/conditions we would like to look into.

1) We need clarity on the approved building plans (I'm willing to go to council myself).
2) There is currently a tenant in and we need to ensure we don't find ourselves stuck with a tenant

I feel all of the above work can be for nothing if we can't agree on the price before we work in new conditions into the OTP.

Questions:

1) Is it normal to do an OTP instead of a verbal agreement to test the water on the price. Imagine how many changes will be done on the OTP, if we adjust the price upward with R50k every time they decline?

2) It looks like we might not take occupation at transfer as the tenants needs to be given notice upon guarantees presented. How do I protect myself with tenants in my property after registration, with them paying rent AND moving out at the end of their notice period.

3) I don't think the agent will take a verbal offer to the seller, she might just say I spoke to them and they said "no". How will I ever know?

4) If we can't agree on how to move forward with my concerns and it is just the agent that feels I'm unreasonable, can I approach a different agent?

 

[Speedster]

The agent you've got is the agent it will be. Why are you hesitant to sign an OTP? Just make sure all your conditions are clearly specified and all should be good.

 

[newby_investor]

A written OTP is standard practice.

Unless they've got a sole mandate, a different agent can approach the seller, but usually not after the first agent has already dealt with you. They can introduce a new person though.

 

[bokka1]

Buyers are liars, sellers are worse.

You need a written offer otherwise leave it.

We are working with a lot of money, if you are not willing to put the offer in writing then don't waste everyone's time.

 

[RonSwanson]

We have been in the market for nearly 6 months looking for a property, looking at relocating provinces.

We have finally found something that we can see ourselves in for the next 15 years. I mentioned to the estate agent that we are willing to offer 7.5% less (we did a lot of due diligence on the area).

The agent is adamant that the seller will take our offer more serious if we sign the OTP and then take the offer forward. For now we would prefer the seller giving us a verbal "yes we are okay with the lower offer".

We are happy to proceed at the lower offer and sign, but we have other questions/conditions we would like to look into.

1) We need clarity on the approved building plans (I'm willing to go to council myself).
2) There is currently a tenant in and we need to ensure we don't find ourselves stuck with a tenant

I feel all of the above work can be for nothing if we can't agree on the price before we work in new conditions into the OTP.

Questions:

1) Is it normal to do an OTP instead of a verbal agreement to test the water on the price. Imagine how many changes will be done on the OTP, if we adjust the price upward with R50k every time they decline?

2) It looks like we might not take occupation at transfer as the tenants needs to be given notice upon guarantees presented. How do I protect myself with tenants in my property after registration, with them paying rent AND moving out at the end of their notice period.

3) I don't think the agent will take a verbal offer to the seller, she might just say I spoke to them and they said "no". How will I ever know?

4) If we can't agree on how to move forward with my concerns and it is just the agent that feels I'm unreasonable, can I approach a different agent?

1) You need to be serious about making the offer and its conditions (which you have mentioned). if you are serious, you want the seller to take you seriously as well. The best way to do that is to reduce the offer to writing.

2) Huur gaat voor koop, so it depends on the current tenant contract's duration. Make the offer subject to the property being vacant upon transfer, and that a copy of the current contract is furnished within 48 hours. The agent can then discuss those details with the seller and revert.

3) You won't know, whether verbal or in writing. Only time you will know is when it is accepted. The agent is bound by law to present all offers, but it is difficult to enforce it it.

4) See response the Q3. You can also ask to see the estate agent's mandate to sell the property. Is the agent registered with the EAAB? Up to date membership certificates, fidelity certificates etc.? Has the agent passed the required exams? Does the agent have a boss?

 

[zerocool2009]

The bond originator also knows how to package your application best. Mine helped me to improve my credit score and available monthly funds by recommending one or two small changes. Ended up with a bigger bond then I would have qualified for at much better rate than if I had gone it alone.

I can bet you, your great MO might be ex banking (homeloan staff).

Next time you buy again, pm me!

 

[kiepie]

Buyers are liars, sellers are worse.

You need a written offer otherwise leave it.

We are working with a lot of money, if you are not willing to put the offer in writing then don't waste everyone's time.

Thanks for all the feedback.

@bokka1 definitely serious, like I said, the questions around the tenant and when they are moving has been dragging on forever. Didn't want to waste anyone's time by going back and forth, adding all the conditions if a) my offer was to low to start of with and b) a new lease agreement has been sign which wouldn't have worked for us.

Update: We received the feedback from the estate agent and will sign an OTP with our offer today.

 

[RonSwanson]

Thanks for all the feedback.

@bokka1 definitely serious, like I said, the questions around the tenant and when they are moving has been dragging on forever. Didn't want to waste anyone's time by going back and forth, adding all the conditions if a) my offer was to low to start of with and b) a new lease agreement has been sign which wouldn't have worked for us.

Update: We received the feedback from the estate agent and will sign an OTP with our offer today.

Make sure that all of your conditions are stipulated in the OTP. Subject to:

• The approved building plans being furnished within a reasonable time (2 weeks should be more than sufficient) and the building/s correlating with the plan;
• Property vacant upon transfer; and
• A copy of the current rental contract is furnished within 48 hours.

 

[powermzii]

Notification that our stuff has been lodged today

 

[wtg]

Notification that our stuff has been lodged today

Where? Mine was meant to be lodged last Wednesday in pta I think - but then they closed the deeds office due to a positive case...still waiting

 

[powermzii]

Where? Mine was meant to be lodged last Wednesday in pta I think - but then they closed the deeds office due to a positive case...still waiting

Also PTA - we were also delayed by that covid closure but it seems they were able to lodge today