100% home loans in South Africa

Banks have responded to the improving economic climate in South Africa by re-introducing 100% home loans. We have discovered that unlike the pre-recession era, home loans are only granted to exceptionally credit worthy clients. Some of the factors which come into play are a "squeaky-clean" credit record and a history (at least 6 months) of retail accounts, which have been paid religiously. Home loan criteria has also become more stringent as it relates to foreigners & South Africans living abroad, with most banks offering a maximum of 50% finance (except for Standard Bank which offers up to 70% for South Africans living Abroad).

As of this writing, the following home loan offers are available from the four major banks:

• Standard Bank: 104% to first time buyers and 100% to other buyers, only if the client applies directly to the bank (branch or call centre) and does not make use of a mortgage originator. All other clients can expect 90% LTV offers.
• Nedbank: 100% finance for properties up to 3 million.
• FNB: 100% finance for all properties up to 2 million.
• ABSA: 90% home loans for bank clients up to 1.5 million.
• Sanlam: Same offering as ABSA

Nedbank is presently the only bank offering 100% finance for building packages, with FNB next in line at 90%. The best offers for vacant land are from Standard Bank for 75% up to 1 million and Nedbank for 70%.

The following collateral will be considered by ABSA, Nedbank and Sanlam, for those who do not have a cash deposit:

• Cession of ABSA fixed deposit / fixed deposit with other institution
• Life policy with a sufficient surrender value
• Approved group scheme / company / government guarantee
• Pension supported housing loans
• CRIS guarantee
• 3rd party limited surityship

Please note that this information is subject to change and that we make no claims on behalf of the banks. It is merely indicative of our recent experience in the market and information which has been provided to us from 3rd party sources. Please contact the respective banks for the latest home loan information. 

Chilli Properrty is a registered mortgage originator. If you would like additional information, please click here to contact us for a no-obligation chat.