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All About Saving On Your Home Loan

By Matthew Wilding

The property market in South Africa has the potential to be very lucrative. There are many ways that a potential buyer can take advantage of the current lending situation, especially if they want to purchase a home loan. In order to have the best chance of success, it is important to understand the different methods that will save you money on your home loan.

In South Africa most of the lending companies, are offering their clients 20 year bonds. A lot of them are willing to lower the interest rate by significant amount, if the client chooses to reduce the bond term, even if it is for a few years. This reducement can save the client, many thousands of Rands, it can make a difference in his saving and allow the client to take an early retirement.

Basically, what happens is that if you agree to pay a little extra over your standard monthly interest rate, your financial institution will agree to lower the variable rate on your home loan. This practice is becoming more and more common among financial institutions all over the world. If you own a home in South Africa and your financial institution agrees to such an arrangement, you could end up saving thousands of rands a month.

You can use your additional cash, like that of a tax refund, or a job bonus or some unexpected amount received by you as a sheer luck; for the reduction of the amount of your home loan. May be that extra amount of such type is just a small amount; but you must not forget that each time you make an additional payment, your mortgage is recalculated and the interest rate on your home loan goes down accordingly.

Another great possibility is to change financial institutions so you have one that gives a lower interest rate. Some banks in South Africa are giving rates two percent less than prime to those who are willing to switch. That’s a chance to save a lot of money.

Before you choose which financial institution you’re going to work with, make sure to do your homework and gather any and all relevant information. This advice, of course, can apply to just about any situation, but it is very important in this instance. For while you may think you’ve found the cheapest and best option out there, it’s still important to check out all your options just to be sure.

You must take your current financial situation into account when deciding on a loan option. If you are worried about the interest rate possibly rising the future, then a fixed interest rate loan might be for you. If you believe that interest rates will decline, then a flexible loan rate will allow you to take advantage of the savings.

Not only will following this advice get you the best possible loan, it will also help you to secure the best interest rate you can get. Following these procedures, in fact, will end up saving you far more than you realize.

If you want to get easy FNB home loans visit home loans South Africa.

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Article Citation
MLA Style Citation:
Wilding, Matthew "All About Saving On Your Home Loan." All About Saving On Your Home Loan. 10 Jul. 2010. 5 Aug 2014 <>.

APA Style Citation:
Wilding, M (2010, July 10). All About Saving On Your Home Loan. Retrieved August 5, 2014, from

Chicago Style Citation:
Wilding, Matthew "All About Saving On Your Home Loan"

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