Bonds, Home Loans, Switches and Further Loans
What are the Costs InvolvedThere are a lot of hidden costs involved when buying a home and most people are actually unaware of them. Buying a home can be very exciting, but also very stressful, so it's always a good idea to plan ahead. Before diving in head first, make sure you do your homework and get all the facts, as not to get any surprises at a later stage. Costs
DepositMost banks require a deposit when applying for a bond. The only time it isn't required is when you are a first time home buyer. The deposit generally depends on the value of the property, but in most cases is 20%. Bond Costs and Transfer DutiesThese costs are always overlooked when purchasing a property, and should be studied very carefully so that you understand how it is worked out. These costs can amount to thousand's of Rands, so make sure you know what they are as it will affect the total value of the property you are looking for. Note : If your are a First time Home Buyer you can have these costs included in your Home Loan. Conveyancing Fees ( Transfer and Registration fees )You have to pay the conveyancers (attorneys) who register the property in your name, as well as the conveyancers appointed by the bank to register a mortgage bond over your property. The Law Society has recommended tariffs that conveyancers may charge to transfer property into your name and register your bond. The higher the purchase price of the property, the higher the fee. The fee's are worked out on a sliding scale. Examples Transfer Costs ( excluding vat ) R 480,000.00 property cost - R 6,000.00 fee R1,000,000,00 property cost - R 10,000.00 fee In addition they also charge about R 250.00 for postage and sundry expenses. Registration Costs ( excluding vat ) R 480,000.00 property cost - R 4,000.00 fee R2,000,000,00 property cost - R 14,000.00 fee In addition they also charge about R 250.00 for postage and sundry expenses. Deeds Office levies and feesThe Deeds office is a government office that falls under the Department of Land Affairs. There are offices all over the country and they are responsible for the registration of ownership and other rights in immovable property. Transfer Costs Up to R 80,000.00 - fee is R 55.00 Between R 80,001.00 and R 150,000 - fee is R 200.00 Between R 150,001.00 and R 300,000.00 - fee is R 260.00 Between R 300,001.00 and R 500,000.00 - fee is R 340.00 Between R 500,001.00 and R 1,000,000.00 - fee is R 400.00 Between R 1,000,001.00 and R 2,000,000.00 - fee is R 500.00 Between R 2,000,001.00 and R 3,000,000.00 - fee is R 650.00 Between R 3,000,001.00 and R 5,000,000.00 - fee is R 800.00 Registering a Mortgage Bond ( Home Loan ) Up to R 150,000.00 - fee is R 200.00 Between R 150,001.00 and R 300,000.00 - fee is R 260.00 Between R 300,001.00 and R 500,000.00 - fee is R 340.00 Between R 500,001.00 and R 1,000,000.00 - fee is R 400.00 Between R 1,000,001.00 and R 2,000,000.00 - fee is R 500.00 Between R 2,000,001.00 and R 3,000,000.00 - fee is R 650.00 Between R 3,000,001.00 and R 5,000,000.00 - fee is R 800.00 For bonds over R 5,000,000.00 - fee is R 1,000.00. Rates and TaxesProperty cannot be transferred from one owner to another until the rates due to the local authority have been paid in full for the financial year. The seller is liable for rates only for the part of the year during which he/she occupies the property. In addition to paying a pro rata proportion of the municipal rates for the year, the buyer will be charged for a rates clearance certificate which is about R 30.00. If you are buying a sectional title unit, expect to pay your levy up to the end of the body corporate's financial year, and to pay for a clearence certificate from the body corporate which is between R400.00 and R800.00. Bank ChargesIf you finance your new home with a home loan, you must make provision for the following charges.
Home Owners InsuranceWhen taking out a home loan, the banks will insist that you take out home owners insurance, before the loan is approved. In fact it is a condition and in most cases, the banks will recommend their own brokers, so get a few quotes before signing your policy. For more information on home owners insurance Click Here . Note : if you are buying a flat or sectional title unit, the home owners insurance is usually included in your monthly levy. Ask your estate agent about this when you make an offer to purchase. Life Cover ( Insurance )In most cases the banks will insist that you take out a life cover policy, if you don't already have one. Generally this is only required when the value of the property is less than R 150 000.00, but each Bank is different, so ask this question before applying for your home loan. Essentially this is for the protection of you and your family, ensuring that your home loan is settled in the event of your death. Most banks will have a brokerage firm that will draw up the policy for you, or you can apply for one on your own. - Click Here for a Free No Obligation Quote from 1 Life Direct. Moving CostsThe cost of hiring movers is high, especially if you take out insurance to cover damage to your goods during your move. Water Bill, Electricity and Household CostsThese expenses are often neglected when purchasing a property, although they have nothing to do with your home loan expenses, some of them are monthly expenses and must be taken into account when doing your budgets.
Note : If you are purchasing a flat or sectional title unit, your water bill will be included in your monthly levy. Discounted Bond RegistrationPlus If you make use of our selected transfer attorneys, they will offer you 40% discount on the bond registration costs and their fee on the property transfer. |
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