There is nothing worse than finding your ideal home and then realising that you do not qualify for the amount of home loan financial assistance that you require to purchase the property. This is why you must always apply for your pre-qualification to see what value home loan you qualify for before you start house hunting.
Although this is a frustrating situation when you realise that you don’t qualify for a sufficient loan for your dream home, there are 5 active factors that you can consider to increase the value of the home loan!
1) Create additional income streams
Finding a second job or additional income stream will definitely increase the loan that you will qualify for. Although you must always purchase a house that you can comfortably afford, any additional regular and sustainable income will help with your application and will assist early settlement of your principal debt, so that you can look forward to purchasing your second property.
2) Save for a larger deposit
The bigger the deposit you have to offer, the less you need to borrow which will bring down your monthly instalments and decrease the interest that you would have to pay over the term of the loan.
3) Consider multiple applicants for the home loan
Buying the property with someone like a spouse, sibling or friend will secure you a higher loan as two or more incomes incur less risk to the bank. However, it is imperative that you chose this person wisely as this is a long-term investment for both parties, which can become costly if you need to buy someone else out sooner than anticipated.
4) Reduce your expenses
Regularly review and be realistic about your budget, as there are always additional spoils and treats that can be cut away, which will free up additional disposable income.
5) Legal Fees
First-time home buyers can qualify for legal fees to be included in the bond, along with bond attorney discounts, but generally a maximum of 105% bond, however, the total amount must still fall within the applicant/s affordability, and should not exceed 1.8M including the legal costs.
To arrange your pre-qualification please contact Martin on 082 447 3463 or Shannon in the Western Cape on 084 701 2865