You have found your ideal home and it's time to put in that offer to purchase. Any savvy individual who has embarked on their dream home buying journey knows, getting pre-approval is key. It also helps avoid any red flags that might see your home loan turned down.
This ensures you're able to put in an OTP and minimise any chance of having the perfect home snatched from your nose. One way to approach this is to use a bond originator, who is able to submit applications to more than one bank on your behalf.
It is important to note that there are several reasons a home loan application could be turned down.
Homeowners insurance is mandatory to qualify for a bond as it covers the financial institution's investment. One of the factors determining the monthly premium is the replacement value of your property. Most financial institutions offer this coverage, however, it is advisable that you shop around for an offer that suits your needs and your pocket best.
If you've found your dream home, then there are some strongly advisable checks you should consider conducting, prior to putting in an offer to purchase. Marius Steyn, Personal Lines Underwriting Manager at Santam - SA's leading short-term insurer - suggests conducting a home inspection prior to purchase, then putting in a clause that an offer to purchase is subject to stipulated repairs.
"Remember, your insurer is only responsible for damages occurring from the date of registration of your new home at the deeds office, onwards - not for any prior problems. This means you need to have any damages fixed by the seller, as a condition of your offer. Otherwise, these could become big issues down-the-line."
Add to that, keep the following in mind which could affect your homeownership goals before you've even started:
Make sure your application contains all the necessary information, and always notify your creditors when you change jobs as it could be a strike in your bond application if income information is not up to date. By getting pre-approved for your home loan first you'll avoid being disappointed. It also gives you a solid indication of what you can afford on a new home.
Similarly, shop around for the best deal when it comes to your combining your building and home contents insurance and save.
More reasons to insure with Santam
Santam also offers free 24/7 SOS services related to road assistance, home assistance, route assistance, medical assistance, home drive assistance and legal advice. Just call 0860 505 911 or speak to your broker.
As South Africa's largest short-term insurer, insuring risks of over R4 trillion. "We've paid out 99% of all claims made in the past year. We also offer the following cover and benefits:
If you have any questions about building insurance, speak to a Santam broker or contact them on 0860 444 444. If you're an existing Santam client, you can add new items and make changes to your cover on the Santam client application. You can also use this online Santam directory to locate a trusted broker in your area or email clientportal@santam.co.za for assistance.
Try this handy building calculator tool to help you make an inventory of all the structures on your property. Or click here to have a professional risk assessment done.
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