In order to determine what home loan amount would you qualify for, there are a couple of aspects you have to look at. The first and most important point would be your monthly income. Your monthly income may be combined with your spouse’s income in order for the bank to determine how much money you are able to borrow for a home loan. Then, you have to look at the interest rate; the lower the rate is, the bigger the amount of the bond will be. You also have to look at the term in which the loan would be taken out on. The most common term will be twenty years, but in some cases you may extend this to thirty years. However, the longer you pay it off for, the more it amounts to.
Thanks to the credit crunch, the banks in South Africa have had no choice but to do away with their home loan offerings of 100%. The property market has turned slightly since then though, and is showing signs of quite a speedy recovery, so it might not be all that bad. Some banks still offer 100% bonds again, but unfortunately not all of them are able to do this.
Another thing you will have to look at when determining what home loan amount would you qualify for, is your credit rating. Your credit rating is important as it will determine whether or not you get approved for finance in the first place. You can visit your nearest bank (of a branch you are currently with) and they will be able to tell you exactly how much you qualify for by looking at your income, your credit rating and everything else that is important. Once you, together with a consultant from the bank, have determined what home loan amount would you qualify for, you can go ahead with.