Most often, consumers rely on real estate agents or third parties to assist them with home loan applications. This results in them not fully understanding what banks consider when approving or declining an application.<\/p>\n
Mpho Ramatong, FNB Home Loans Division channel head, says first time home buyers can significantly improve their chances of qualifying by familiarising themselves with the common pitfalls that often lead to home loan applications being unsuccessful:<\/p>\n
“Before applying for a home loan, consider checking your credit profile and taking corrective measures if necessary. Consumers in South Africa have the right to get one free credit report, once a year, from a registered credit bureau,” said Ramatong.<\/p>\n
“If affordability is an issue, a higher deposit, joint bond application with a spouse or family member, or property of a lower value should be considered,” said Ramatong. Getting a pre-approval ahead of a home loan application can help consumers determine if they qualify and whether a deposit will be required.<\/p>\n
Self-employed individuals are required to produce a minimum of six months\u2019 worth of financial records or bank statements.<\/p>\n
For example: if you have a credit card that you might be using to fill up for petrol and for groceries, you need not include the groceries portion and petrol spend in your expenses.<\/p>\n
“Although every application is unique and assessed on its own merits, taking time to understand what lenders consider when assessing an application will go a long way to helping you purchase your first house,” Ramatong said.<\/p>\n