Buying A Home Check – List

Buying a home is a major step towards creating a haven for your family and making a long-term investment in your financial future. As such, it is a purchase that should be carefully considered and planned for.

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Steven Barker, Head of Home Loans at Standard Bank, shares steps to take when buying a house

Checking your credit history

When a bank assesses a person for a home loan, their credit history plays a major part in whether they are suitable. It pays to:

  • Check your credit rating;
  • Ensure any outstanding debts are settled; and
  • Make sure that any accounts you may have are correctly serviced.

Affordability

  • Make sure you have sufficient money to pay a deposit on the house. Although a bank assesses people’s financial situations individually, it is now very rare to get 100% bonds.
  • Remember the additional costs. These include attorney’s fees, transfer costs and registration fees.
  • Enquire about rates and taxes that will be payable on the property.
  • Plan for the one-off costs such as electricity deposits, and consider what additions like security are likely to cost.
  • Check what insuring the property will cost you on a monthly basis.
  • Consider credit life cover to protect the loan outstanding balance in the event of disability, dread disease, retrenchment or death.

Future financial commitments

  • Plan for the future by making sure that your personal cash flow can cope with increased payments if interest rates should rise. By preparing a personal budget that allows for costs to increase, you will avoid future financial difficulties.

“Taking a proactive approach to monthly bond payments when buying a house also sows the seeds from which you will reap rewards”, Says Mr Barker. “If you buy a house and can pay extra money on your bond, the benefits can be significant; any additional money paid in is credited against the account and saves on interest costs. These savings can be significant and knock years off your repayment period.” concludes Mr Barker.