Tips for first-time buyers: use a bond originator

The process of applying for a home loan can be overwhelming, especially for first-time homebuyers. Luckily, there is a free service that can help you find the best deal on your home loan - only trouble is that not many first-time buyers know about it. For those who are venturing on their first big property investment, here's how using a bond originator can help you...

Services offered by the bond originator
Bond originators have several services that will help you navigate the bond application process more efficiently. As experts in their field, a bond originator will be able to assist you with the following:

• Assessing your financial situation and level of affordability.
• Advise you on the best way to finance your new home.
• Explain all the different banks' home loan options.
• Assist you with the paperwork when applying for a bond.
• Liaise with all of the major banks and negotiate the best possible deal on your behalf.

There is no cost to you!
The way that bond originators work is that the estate agent will receive a commission from the bond originator for referring a buyer, and the bank that grants the home loan will pay the bond originator a fee once the bond is registered. This means that you receive the service of a professional bond originator at no cost to you. This is a great benefit for first-time buyers as the financial stress of buying a house is already quite stressful.

Aim for a reputable bond origination brand
There are numerous bond origination companies in South African, so you'll need to ensure that you choose to work with a brand that is reputable and respected in the industry, such as BetterBond. Make sure that the originator doesn't request an administration fee, as this is not normally a fee that a home buyer would incur. Also, you're not obliged to sign any agreement with a bond originator.

How to apply through a bond originator
Once you have selected your preferred originator, you'll need to provide the originator with all your personal information such as contact details and a copy of your ID document. They will also require your banking detail, financial information and a copy of your latest salary slip or audited financials if you're self-employed.

The bond originator will then complete the bond applications and submit them to the banks on your behalf. Once the applications are submitted to the banks, you should hear from the originator in the next 3-5 working days, provided the information given is correct and accepted by the banks. You should evaluate each option provided, considering the pros and cons of each of the bank's products and the interest rate they're willing to offer. However, you're under no obligation to accept any of the offers that the bond originator comes back with.

Bond originators can't guarantee a home loan
It's important to remember that using a bond originator will significantly simplify the process for you, however, bond originators can't guarantee that you'll obtain a home loan. All lending by the banks will be subject to your affordability and ability to repay the loan. Regardless of whether you use a bond originator or not, you'll still need to have a good credit record, disposable income available, a deposit, and additional money for the costs associated with purchasing a property.

Tip: First-time buyers shouldn't buy solo
There's no doubt that using a bond originator as a first-time buyer will be incredibly beneficial as you will receive a comprehensive and valuable service without breaking the bank. If you're still on the fence about using this invaluable service, reach out to a local real estate agent who can offer further guidance and provide you with a trustworthy bond originator referral.