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Standard Bank Home Loans

The Standard Bank Home Loan

Standard Bank is the second largest mortgage lender in South Africa and enjoys a market share of about 30%. In their Annual Financial Results Report (FY 2007) that was presented on the 5th of March, Standard Bank indicated that the income from their home loan business was up by 20%. If you consider that the downward slide of the property industry started gaining momentum last year, Standard Bank must have been doing something right to achieve this type of growth.

The ‘something right’ could be that they remained true to their “Simpler Better Faster” motto – particularly where their retail banking products are concerned. Their commitment to (especially) simplicity is mirrored in the four different mortgage packages Standard Bank currently have on offer:

DreamStart
JumpStart
Ordinary Loan
Cost Inclusive

DreamStart

DreamStart is designed to afford consumers in the lower income brackets an opportunity to buy their own homes.

Features and Benefits

Some of the features and benefits of DreamStart include:

Loan Term

The standard repayment term is 20 years.

Financing

Financing is normally provided for up to 80% of the purchase price. If you do not have the 20% deposit required, the bank will ask you to provide collateral. Should you have no collateral, they will arrange for a guarantee that you can either pay upfront, or as a part of your monthly mortgage repayments.
Presents you with a choice between fixed and variable interest rates. Interest rates can be fixed for periods of 12-, 18- or 24 months.


Transacting

Mortgage repayments are made by debit orders. If you don’t have an account, you will be offered the opportunity of opening an E-Plan account.
Additional deposits are allowed at any time. By making additional deposits, you save on interest.
You can also apply for AccessBond, which is an add-on that allows you to access the additional deposits you make into your home loan account.

Qualifying criteria

To qualify for DreamStart, you need to earn a single or joint income of between R 1,500 and R 6,000 per month, meet Standard Bank’s credit requirements and possess a valid South African Identification Document. DreamStart is only applicable if you want to buy or build a residential property.

Comment

DreamStart comes with a rewards program: If you make your minimum monthly payments on time, every time, you could qualify for rewards after 24 months and then again after 36 months.

JumpStart

JumpStart is designed for first time home buyers who do not have the cash to pay the upfront registration and transfer costs of a property.

Features and Benefits

Some of the features and benefits of JumpStart includes:

Loan Term

Loan terms of up to 30 years are granted.

Financing

Financing can be structured either to cover 100% of the purchase price plus 8% for transfer and registration costs or 100% of the purchase price plus a payment holiday of up to three months. If you opt for the payment holiday, transfer and registration costs will not be financed through your loan.
You are also allowed to choose between a two year fixed interest rate and a variable interest rate. No rates concessions are available on JumpStart.


Transacting

Mortgage repayment by debit order is compulsory.
Additional deposits are allowed at any time. By making additional deposits, you save on interest.
You can also apply for AccessBond, which is an add-on that allows you to access the additional deposits you make into your home loan account.

Qualifying criteria

To qualify for JumpStart, you need to earn a single or joint income of more than R 6,000 per month, meet Standard Bank’s credit requirements and possess a valid South African Identification Document.

Comment

JumpStart is only applicable to individuals wanting to buy a residential property. Switching, business loans, commercial loans and vacant land loans are not available on JumpStart. A further important consideration is that for loans in excess of 100%, both the Fixed Rate option and the Variable Rate option come with built in Life, Disability and Retrenchment Cover (HLP). You will not be allowed to cede one of your existing policies or to take out a further policy from another company to cover your JumpStart mortgage risks instead.

Ordinary Loan

Ordinary Loan is a traditional home loan product designed for consumers who have the necessary cash to pay their upfront registration and transfer fees.

Features and Benefits

Some of the features and benefits of Ordinary Loan include:

Loan Term

Loan terms of up to 30 years are granted.

Financing

Financing is provided for up to 100% of the purchase price. No deposit is required.
Interest rates are available as variable and fixed options. The fixed option is available for 12-, 18-, or 24 month periods.

Transacting

Mortgage repayment by debit order is compulsory.
Additional deposits are allowed at any time. By making additional deposits, you save on interest.
You can

Qualifying criteria

To qualify for Ordinary Loan, you need earn a single or joint income of at least R 6,000 per month, meet Standard Bank’s credit criteria and prove permanent employment.

Cost Inclusive

Cost Inclusive is designed for prospective, non-first-time buyers who lack the cash to pay for the upfront registration and transfer costs of a property.

Features and Benefits

Some of the features and benefits of Cost Inclusive includes:

Loan Term

Loan terms of up to 30 years are granted.

Financing

Financing is structured to cover 100% of the purchase price plus 8% for transfer and registration costs. No deposit is required
You are allowed to choose between a fixed interest rate and a variable interest rate.

Transacting

Mortgage repayment by debit order is compulsory.
Additional deposits are allowed at any time. By making additional deposits, you save on interest.
You can also apply for AccessBond, which is an add-on that allows you to access the additional deposits you make into your home loan account.

Qualifying criteria

To qualify for Cost Inclusive, you need to earn a single or joint income of more than R 6,000 per month, meet Standard Bank’s credit requirements and possess a valid South African Identification Document.

Comment

Cost Inclusive is only available to individuals wanting to buy a residential property. Business loans, commercial loans and vacant land loans do not qualify. Another important consideration is that for home loans in excess of 100%, both the Fixed Rate option and the Variable Rate option come with built in Life, Disability and Retrenchment Cover (HLP). You will not be allowed the alternatives of ceding one of your existing policies or taking out a further policy from another company to cover your Cost Inclusive mortgage risks, instead.

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