We all eventually get to a stage in our life when it’s time to leave the nest. Whether that means building a home, moving into someone else’s or buying your own property, the decision is as exciting as it is nerve-wrecking.
The truth is having a roof over your head is one of the basic needs of any human being. You could be living in one bedroom studio apartment or in a 7 bedroom mansion. The essence of it is whether you are paying rent or you are paying for a bond.
Many South Africans aspire to owning their own home. The fact is that only 60% of the South African public own, or are paying towards owning, their own home.
Purchasing Your Own Home Is Not Easy
As most homeowners know, the road to purchasing their own home was not easy. If searching for the perfect home in the perfect area was not hard enough, obtaining finance for the purchase made it even more stressful. If you decided to build your own home, you had to have at least a 30% deposit as most banks have a policy of only financing 70% of the home to be built.
However, all this is incidental. You would still need to have a good credit score. Few banks will even look at your application if your credit rating is below required standards. Furthermore, banks need to ensure that you can afford the repayments on the bond as per the National Credit Act. So a good credit record and a reasonable disposable income (income remaining after you have paid all your expenses) seems to be the “foundation” for your loan application to be approved.
Re-Building Your Credit Record
Building a good credit record is essential to you being able to purchase a home and this is one of the aspects that is within your power!
You can begin to build a better credit score today, but remember when you plan to run the Comrades Marathon, you do not wake up one day before the event put on your running gear for the first time in 5 years and the next day attempt to run 98 km. You start your training many months in advance.
In the same way you must begin today to ensure that you are ready to purchase your new home in the future.