Navigating banking systems is almost always stressful and tediously litigious, and particularly true when it comes to applying for a home loan. Despite all their efforts, new home buyers are still not successful when applying for a bond independently.
While bond originators take the hassle out of applying for a home loan and reduce the time it takes to be approved, they also give prospective buyers a way to ensure that they are offered the most favourable loan package and interest rate.
Using a bond originator saves you time and paperwork and often means that the banks’ turnaround time is reduced, ensuring you get quotes faster. The estate agent may pass your name on to a mortgage origination company, meaning that you do not even have to make the phone call; they will call you. What’s not to love about this?
Well, for starters, say, industry experts, you should make sure your bond originator is independent. You have the right to choose your bond originator, as your home loan is involved. Do not be pressured by an estate agent into signing with a particular originator. Check your offer of purchase to make sure that you aren’t locked into a relationship with an originator upfront.
Consumers need to be aware of their rights and that they can select their originator.
“When signing an offer to purchase, buyers need to get independent advice. An estate agent can’t represent both buyer and seller. Get your attorney or your buyer’s agent to read it over,” says Nadia Isaacs, Chief Operating Officer, MultiNET Home loans.
Bond originators are not always independent. Many estate agencies have agreements with originators and are paid commissions for the businesses they pass on. Despite this, Isaacs believes that the role of bond originators has never been more critical. Post-COVID-19, banks are risk-averse, and buyers need all the help they can get.
“As a free service, the bond origination process moves the burden from the buyer to the originator, who then hunts for the best financial deal. These experienced agents have the agility and knowledge to successfully navigate the banking system, knowing how to achieve a successful outcome,” says Isaacs.
MultiNET Home loans is the biggest independent bond originator in South Africa at this time covering the entire market, including non-bank lenders such as Sentinel Homes and private banks such as RMB.
When deciding to use an origination service, it is always helpful to check how much you can afford, for which there are many home loan calculators online. Doing a personal credit check is also advisable to avoid wasting time and applying for a home loan that is beyond your reach.
The neutrality of the bond origination service is incredibly valuable; there are no allegiances with any one bank, just a desire to get the buyer the best deal. This independent advice is always beneficial and useful as the bond originator can outline the pros and cons of each sale on offer to the prospective buyer.
Bond origination is about giving an identity to what otherwise is just another application. Clients do not get lost in the system; there is a champion representing the application, and fighting for the best deal. Given that it is a free service, the use of this service is often a best-kept secret.
Bond originators will get clients the best rate on their bond. What seems like a small difference between interest rates can save clients much money over the term of their loan.
“A saving of 1% over the lifetime of a bond will save a client about 30% of the value of their bond in compound interest,” says Isaacs.
“Our biggest saving to date was R2 522 535.55. That reduced the client’s 20-year bond to around 14years.”
MultINET is an Independent Mortgage Originator with a personal touch in an industry dominated by a few massive players and nameless, faceless call centres, delivering meaningful results for clients through smart people and technology.