What is a Bond? Start here...
If you wish to purchase property, either for a home or business, you are almost always left with no choice but to take out a bond. Bonds are also known as mortgages, and chances are unless you are living under a box, you are well aware of the recent mortgage crisis.
Did you know on average, a family will move three times? That means that you are changing residences more often than you might think. And even if you don't fit the norm, sometimes you need to expand.
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 current mortgage crisis has resulted from banks, especially in the United States, becoming too lenient in who they offer mortgages too. In fact, sometimes banks allowed people to take out mortgages with little down. They are now paying the price, and as a result, must only offer new mortgages with a high down payment.
When considering such a request, the bank will follow the procedures that they would do when granting a new mortgage, but with one or two minor differences. If you plan on renovating your current property and just need help via a loan, the bank will request you submit estimates from professional contractors. Banks are much more inclined to grant the money if professionals will work on the renovation and not yourself.
After you provide the bank with all the details, they will sit down and study your case. The bank needs to decide if you really need the money and if you will be able to pay it off. It's difficult paying off one bond much less two.
Banks who issue bonds are entitled to ask for banks statements and details of income. Banks prefer to see bond repayments be no more than one third of the joint net salaries of the buyers. They will never admit this openly, but banks need to have this type of verification.
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.
Did you know on average, a family will move three times? That means that you are changing residences more often than you might think. And even if you don't fit the norm, sometimes you need to expand.
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 current mortgage crisis has resulted from banks, especially in the United States, becoming too lenient in who they offer mortgages too. In fact, sometimes banks allowed people to take out mortgages with little down. They are now paying the price, and as a result, must only offer new mortgages with a high down payment.
When considering such a request, the bank will follow the procedures that they would do when granting a new mortgage, but with one or two minor differences. If you plan on renovating your current property and just need help via a loan, the bank will request you submit estimates from professional contractors. Banks are much more inclined to grant the money if professionals will work on the renovation and not yourself.
After you provide the bank with all the details, they will sit down and study your case. The bank needs to decide if you really need the money and if you will be able to pay it off. It's difficult paying off one bond much less two.
Banks who issue bonds are entitled to ask for banks statements and details of income. Banks prefer to see bond repayments be no more than one third of the joint net salaries of the buyers. They will never admit this openly, but banks need to have this type of verification.
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 Credit Counseling at
11:30 AM
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