Nedbank home loan is a property financing solution for people with a monthly income of R2,500.00 or more. The loan can finance up to 100% of the property’s value.
Furthermore, first-time buyers can obtain financing for up to 105% of the property’s value to cover bond and other costs. First-time home buyers seeking 105% home loan financing should purchase property worth between R100,000 and R1.8 million.
When applying for a home loan online with Nedbank, applicants can receive up to R20,000.00 in cash back. In addition, Nedbank offers up to 50% off bond registration fees.
Individuals who apply for a Nedbank home loan in a branch may be eligible for a R5,000.00 cash back if their monthly income is less than R27,200.00.
The Nedbank home loan is also available to those who are self-employed or have a permanent or fixed-term contract. Applicants must be 18 years of age or older at the time of application.
This article discusses the Nedbank home and building loan. These loans are covered in greater detail in the following section.
Nedbank Home Loans
Nedbank offers two types of home loans namely the ordinary home loans and the building loans. We will discuss both home loan options from Nedbank in detail below.
Ordinary Home loan
An ordinary home loan from Nedbank is a flexible loan that you can use to buy an existing property or to make structural renovations to your existing property. A property will have to exist in order for a loan to qualify as an ordinary Home loan.
When taking a Nedbank ordinary home loan you might need to have or take an insurance policy for your life. This is to assure that any amount that a loan holder owes is paid by an insurance company should the home buyer die.
There are two insurances that Nedbank has in offer for ordinary Home loan acquirers.
- Homeowner’s insurance: This insurance will protect your home from acts of nature. Acts of nature include natural disasters, flood damage, fires, and more. This insurance is compulsory and you can take it with any insurer of your choice.
- Credit life insurance: This insurance option is optional so you can take it if you see it fit. Credit life insurance secures your family’s home should anything happen to you. The policy will indicate the terms and conditions of events and circumstances that you are covered.
Since a home is the most important asset that a human can own in their lifetime, both insurance options are important. If you want to leave a house that is fully paid for, then you can take a credit life insurance. Alternatively, if you want to insure your house from third-party damage and natural acts then you can choose Homeowner’s insurance.
You can still choose to take both insurance covers to ensure that everything is taken care of in different circumstances. Note that the homeowner’s insurance is compulsory since Nedbank has a beneficial interest in the house you are paying for.
Benefits and features of the ordinary home loan
- You get a variable interest rate at the beginning of your loan term which you can change to a fixed-rate at a later stage.
- Can get up to R25,000.00 cashback on the value of your loan.
- Comes with a standard loan term of 20 years. If you want to, you can ask for an extension of your loan term of up to 25 years. Extension of your home loan repayment duration will be subject to your financial circumstances.
- You can get up to 100% finance of the purchase price.
- You can settle your home loan sooner than the agreed term on your contract. By doing this you will take advantage of the low-interest rates applicable to early settlement.
Building loan
A building loan from Nedbank is a loan used to finance the construction of a house on a vacant land/stand. Nedbank insists that builders that you contract to build a house will have to be members of the National Home Builders Registration Council(NHBRC).
Nedbank has two reasons why you need to use builders that are members of the NHBRC. Reasons are:
- NHBRC members will warrant protection against defects for the home.
- As a customer, you will be afforded protection against contractors who deliver substandard design, workmanship, and poor quality materials by the NHBRC.
By using NHBRC, Nedbank reckons that both the building loan provider and acquirer are safeguarded.
The building loan is issued in parts. This means that the loan will be paid in stages of construction of the house. Nedbank will advance a series of payments on condition that the bank is satisfied with the percentage of building work completed.
Interest on the building loan starts to accumulate after the first payment. The interest will only be for the amount that the bank has already paid. However, you have an option to make your first payment when the loan amount is paid in full.
Like an ordinary building loan, the building loan has compulsory insurance in place. You will need to take a homeowner’s insurance to cover your home from defects. You can take a homeowner’s insurance with any insurance provider of your choice.
If you want to secure your home for your family should anything happen to you, you can take out the credit life insurance. Credit life insurance will pay out if anything happens to you.
Features and benefits of building loan
- You get a variable interest rate at the beginning of your loan term which you can change to a fixed-rate at a later stage.
- Can get up to R25,000.00 cashback on the value of your loan.
- Comes with a standard loan term of 20 years. If you want to, you can ask for an extension of your loan term of up to 25 years. Extension of your home loan repayment duration will be subject to your financial circumstances.
- You can get up to 100% finance of the purchase price.
- You can settle your home loan sooner than the agreed term on your contract. By doing this you will take advantage of low-interest rates applicable to early settlement.
Requirements
Before making an application for your home loan make sure your credit history is on the green. If not, don’t apply before trying to improve your credit status, you can try by involving debt counsellors to help you increase your score. To start an application you can click here.
Have these when you make your application:
- Proof of income (Payslip)
- Copy of your ID
- Three months bank statement if you don’t bank with Nedbank. Must show income.
- Offer to purchase ( very important) *
If you are applying for a building loan then you will need to provide the following :
- Builders all-risk insurance policy.
- Schedule of variation /finishes
- Building contract
- Provisional building or working drawings
- Builder’s waiver of lien
- Original NHBRC enrollment fee certificate
- Standard home builder’s warranty from your builder.
Advantages of the Nedbank Home Loan
- Online application comes with cash back benefit.
- First time buyers get money to pay for a home and other home transfer fees.
- Account holders can choose between fixed and variable interest rates.
- Application is quick and can be done fully online.
- Those that want a building loan can get it.
- Nedbank home loan requires a very low minimum income of R2,500.00.
Disadvantages of the Nedbank Home Loan
- Account holders don’t get free access to the Nedbank Greenbacks rewards program.
- Building loans are only available to individuals who use NHBRC registered constructors who can be very expensive.
Conclusion
Nedbank Home loans come with fees and should not be a shocker. Fees include the Initiation fee, monthly service fee, and transactional fees. These fees are standard for home loans.
Other than these fees, you will only need to pay monthly loan repayments. With Nedbank home loans, you get to save on attorney fees and get cashback for choosing Nedbank home loan. These benefits are special because no other bank offers them.
