Buying property for the first time can be exciting and frightening all at once. Doing your research and educating yourself before taking that leap can eliminate the scare factor out of buying that first property.
“Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full, and managed with reasonable care, it is about the safest investment in the world.” Franklin D. Roosevelt
One of the most important things to consider is whether you’re in the financial position to purchase that property – not only now but should your current circumstances change in the future.
Determining your financial standing in respect to all known homeownership costs is essential to making a knowledgeable decision on a home that is both affordable and payable over a long-term loan period. In order to make an informed decision calculate your income and expenditure along with the deposit and transaction costs, preferably before your house-hunting begins.
Going into your home search fully aware of the costs will give a good indication of what you can realistically and comfortably afford, and will reduce the chance of affordability-related disappointments later on.
First things first, contact a Bond Originator to do a pre-approval. We recommend ooba home loans, they are fast and efficient. Here you will be able to calculate an estimate of what loan you possibly qualify for - https://www.ooba.co.za/home-loan/bond-calculator/. Once you have an idea contact an ooba home loan expert to get your pre-approval started - https://www.ooba.co.za/home-loan/prequalify/#speak-to-an-expert.
Once you have the pre-approval and you know what you are in for you can comfortably start the hunt for your dream home or investment property.
As a first time buyer you are afforded privileges when applying for a home loan, the basic criteria to qualify is the following:
- It needs to be the first time you're applying for a home loan
- You must be at least 18 years or older
- You must be permanently employed for longer than 6 months/self-employed for 2 years
Some of the institutions will offer first timers a bond above 100% to cover some of the Transfer and legal costs. Most banks now offer a 30 year bond repayment period, making the monthly costs more affordable, created specifically for first-time buyers.
However sometimes banks will make you take out a bond protection insurance policy (covering your outstanding bond if you die), which will act as security for the loan. Make sure that you state clearly on your application that you are a first time buyer.
Consult The Professionals
Find someone knowledgeable to assist you through this process, it could be your Estate Agent or your Bond Originator or both. The more professional advice you can get the better. Always ensure that the Estate Agent of your choice is fully qualified and has an up to date EEAB certificate, Rogue Estate Agents can hurt you more than help you.