What is a Bond? Start here...
You already have a bond so what do you need a second one for? Simple, you have ideas of expanding or renovating the property and you once again need assistance from the bank. Banks are always willing to help, just know that they will likely charge a high down payment once again.
Banks want to lend money. In fact, it's one of their primary ways they stay in business and a founding pillar. Holding bonds allow the bank to make a long-term profit. It also allows the bank to own property until the lender has fully paid off the loan.
The bank holds stipulations for individuals wishing to purchase property. For example, the individual must put down a cash deposit against the purchase of property. Generally the buyer must meet a minimum of 30% of what the property is worth.
The recent mortgage disaster stems from banks becoming way too lenient in the way they do business, reducing those restrictions sometimes entirely. Unfortunately too many people got over their heads in debt and have ruined the bond process for everyone else.
Banks now offer bonds only on strict restrictions, including the minimum 30% equity on the property. The banks do this because they need to assure they will recover the total sum of the bond in case the buyer cannot meet the payments.
Bonds are intended for the long-term. Once again the bank makes a profit because of these long-term investments, which means the bank will never offer a mortgage lower than ten years. The more common and popular age of a bond, ranges from twenty to thirty years.
The bank also tends to frown upon second bonds that are intended to help release some capital on the property to a struggling business or to support your own, especially if you are looking to start the business from scratch.
If you meet the bond's criteria, have a stable job and ample income, the bond is probably only a signature or two away. Just make sure allow the bank plenty of time to examine the bond request and you think it through intensely.
Banks want to lend money. In fact, it's one of their primary ways they stay in business and a founding pillar. Holding bonds allow the bank to make a long-term profit. It also allows the bank to own property until the lender has fully paid off the loan.
The bank holds stipulations for individuals wishing to purchase property. For example, the individual must put down a cash deposit against the purchase of property. Generally the buyer must meet a minimum of 30% of what the property is worth.
The recent mortgage disaster stems from banks becoming way too lenient in the way they do business, reducing those restrictions sometimes entirely. Unfortunately too many people got over their heads in debt and have ruined the bond process for everyone else.
Banks now offer bonds only on strict restrictions, including the minimum 30% equity on the property. The banks do this because they need to assure they will recover the total sum of the bond in case the buyer cannot meet the payments.
Bonds are intended for the long-term. Once again the bank makes a profit because of these long-term investments, which means the bank will never offer a mortgage lower than ten years. The more common and popular age of a bond, ranges from twenty to thirty years.
The bank also tends to frown upon second bonds that are intended to help release some capital on the property to a struggling business or to support your own, especially if you are looking to start the business from scratch.
If you meet the bond's criteria, have a stable job and ample income, the bond is probably only a signature or two away. Just make sure allow the bank plenty of time to examine the bond request and you think it through intensely.
About the Author:
Graham McKenzie is the content syndication manager at BondCredit.co.za South Africans leading Bond Originator
posted by Debt Consolidation Loan at
11:35 AM
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