Property buyers should get pre-qualified and run their annual credit check now

A Credit Amnesty was announced by the Department of Trade and Industry earlier this year, which came into effect on 1 June. So if you’re considering buying a home, now is the perfect time to get checked and pre-qualified.

The Department of Trade and Industry’s “Removal of Adverse Consumer Information Relating to Paid-up Judgements Regulations 2014” was implemented on 1 April this year. The regulation requires credit bureaus to remove all information on their credit record relating to paid-up judgements and adverse notations about consumers by 1 June.
“This essentially means that if you went through a difficult financial patch, but have subsequently settled all of your outstanding accounts, your credit record will no longer be affected,” says Justin Easthorpe, regional sales manager for ooba, South Africa’s biggest bond originator. “The credit amnesty also requires any future paid-up judgements to be removed from your record.”
This is good news for potential home buyers, who may have found that despite making amends for unpaid credit and being in a more secure financial position now, they were still unable to get home finance. Despite this, it is still a good idea to run a free credit check – which you are entitled to do annually – to make sure that your record has been cleared.
“Of course, this doesn’t mean that you don’t have to pay your debts,” says Easthorpe. “Maintaining a clean credit record is still the best way to ensure that you are looked upon favourably by the banks when applying for a home loan. But it does mean that it is now easier to recover from past judgements.”
A credit check should form part of the pre-qualification service offered by bond originators and some banks. Your credit record will be assessed and your affordability calculated. The bond originator or bank will then issue you with a certificate that states the amount that you will be likely to qualify for.
“This is of great benefit to the buyer, because it lets you house hunt in a realistic price range with the confidence that your bond application will most likely be approved,” says Easthorpe. “It gives the seller and their agent a level of certainty that you are a serious buyer and that you are able to come up with the finance you need to buy the home.”
ooba’s pre-qualification service – oobaqualified – takes things a step further. If there is some kind of problem with your credit rating, it helps you to take steps to rectify this. And if your affordability is too low, ooba’s experts will counsel you on how to manage your other financial obligations to free up more disposable income.
“We believe that these ‘next steps’ in the oobaqualification process are vitally important to the home-buying process,” says Easthorpe. “We don’t just want to offer our applicants a yes or no answer with an amount – we want to help put them in their new homes.”
He adds that it’s a really good idea to do this at the pre-qualification stage rather than at the bond application stage, because this will give you enough time to take the necessary remedial steps if you need to. “pre-qualification costs you nothing, arms you with knowledge and just makes sense,” he adds.

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 19 Jan 2018
      Extending from Randfontein in the west to Roodepoort in the east and including the towns of Krugersdorp and Magaliesburg, the West Rand has a plethora of property available to residents who choose to make this unique area their home.
    • 19 Jan 2018
      When it comes to financial planning, doing the work to ensure you’re prepared for unexpected emergencies is just as important as ticking off your other goals and New Year’s resolutions. The beginning of the year is also the perfect time to review your various insurance policies.
    • 19 Jan 2018
      No surprises at the first Monetary Policy Committee of 2018, as Reserve Bank Governor, Lesetja Kganyago, announced that the interest rates would stay at their current levels.
    • 18 Jan 2018
      The Southern Suburbs make up some of the most popular residential areas in Cape Town, comprising charming groups of suburbs which lie to the south-east of the slopes of Table Mountain. It is seen as the city's most expensive residential neighbourhoods with a choice of various private schools, upmarket eateries, wine estates, beautiful homes and trendy apartments.
    • 18 Jan 2018
      New year, new goals! If you’ve resolved to purchase your first property in 2018, then this 6-step guide from the Rawson Property Group is a must-read. It will help you navigate and simplify what is often be seen as a confusing process of buying your first home – right from the house-hunt to the house-warming.
    • 17 Jan 2018
      While the current property market may still favour buyers, it doesn’t mean that they shouldn’t be well prepared before putting in an offer to purchase.
    • 17 Jan 2018
      Lightstone lists Blair Atholl as the most expensive suburb with an average house price of R11.2 million, followed by Westcliff (R10.5 million), Dunkeld (R9.3 million), Sandhurst (R9.1 million) and Inanda (R7.2 million).
    • 17 Jan 2018
      As it currently stands, there are four main ways in which a home can be bought in South Africa, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, who adds that deciding in which legal entity to purchase the property is not a decision that should be entered into lightly, as each has its pros and cons.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us