Managing your home loan as interest rates go up.
It’s been a rocky year for many South African as prices for everything have gone up and it seems it won’t be getting better anytime soon.
Homeowners are being compelled to pay thousands more in bond repayments each month as a result of the South African Reserve Bank’s endless interest rate increases.
Kaya Biz with Gugulethu Mfuphi spoke to Corne Welman, Franchise Principal and Certified Financial Planner at Consult by Momentum Points on how South African can managing their home loan as interest rates go up.
On the endless interest rate hikes
“It was a shock to the system, it was a shock for all of us, this topic has been a hot topic for the last few months. This is affecting all of us, we can all feel it in our pockets, and it is getting worse. It’s gotten to a point were people are loosing their homes, people can not make payments, they are defaulting, and people are getting bad credit records.”
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“Don’t ignore the problem, be pro-active”
“The banks typically send you reminders, and we are all human and sometime we don’t see it. When you don’t make you monthly payments they send you to a debt collector, who then demand immediate payment. You can’t ignore the problem, you have to be proactive.
Welman also said that the next several years are likely to see an increase in interest rates, therefore homeowners who haven’t reviewed their bond commitments should do so.
She encouraged South Africans particularly those who are buying homes for the first time to consider obtaining the best interest rate or choose whether to fix your interest rate right away.
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