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How To Create Competition Amongst The Banks For A Home Loan Application


How To Create Competition Amongst The Banks For A Home Loan Application

Obtaining a home loan is one of the most important steps in the whole property buying process - as it breaks any deal if the property buyer cannot obtain the funds for buying the property. If the purchase is dependent on a home loan, the application process can lead to a lot of frustration for the buyer and estate agent.

Working with home loan specialist and bond originator makes the home loan application process a more controlled situation with much higher approval chances and a faster turnaround time than if a client applied for a bond on their own - effectively increasing the success rate of the sale. Buyers applying directly for home loans success rate can be as low 35% success rate whilst bond originators can push the client's success rates for an approved bond up to 75%.

Bond brokers and home loan specialists offers their services at no cost to property buyers - they are paid a commission by the banks. The banks do not penalise buyers for using a Bond Originator - the fees are exactly the same

Bond brokers act on behalf of the buyers by submitting their bond application to all banks simultaneously. By creating a scenario where banks are actually competing for the business of the buyers (home loan applicants), the best deals and rates on the home loan are generated, the turnaround time are shortened while the client gets a much higher chance for an approved bond. Buyers also receives continuous feedback from the bond brokers / home loan specialists.

CCH believes that stimulating competition for the home loan or bond business of our property buying clients is of utmost importance.

CCH therefore proposes to all our clients to always ensure that their bond applications will be handled via 2 channels in direct competition with each other. By submitting your bond application to only one channel (i.e. going to only one bond broker or only your own bank's home loan section), the lack of competition for your business could relay in either a higher interest rate over the bond repayment period - or even worse - you could potentially not receive a bond.

It is well-known in the property industry that at least a quarter of all approved bonds were originally declined by the applicant's own bank or another bank he/she first applied at.

CCH therefore proposes to refer our potential buyers to the direct Nedbank Channel as well as to another experienced bond broker who can then approached the other big banks (financial institutions) for a competing quote. This two-pronged approach ensures that the home loan consultants / bond brokers will get the best possible interest rate on the buyer's application - as there are no-one in total control of the application process and both parties will not know what the competing offer (quote) will be.

CCH estate agents and their buyer clients have a dedicated Nedbank Home Loan Channel. CCH estate agents also refer our potential buyers to a variety of competing bond broker channels which consists of all the biggest bond broking firms (originators) in South Africa.

By separating the 2 bond application referrals, potential buyers effectively put themselves in a much stronger situation which can realize over the 20 or 30 years bond repayment period major savings for themselves.

For more information, or to make use of this offer, please contact one of our member estate agents to get you in touch with these dedicated bond application channels. The bond broking channels CCH member agents will put you in touch with, includes, Ooba, Betterbond, CapCubed, Multinet, SA Homeloans etc.

The Nedbank Dedicated Channel's Client Value Proposition includes:

  • A professional Home Loan Sales Consultant team who offer expert advice and service to clients who is in the market to purchase a home.

  • A commitment to deliver an 8 hour business turnaround time to applicants CCH referred and who has provided a fully completed Home Loan application that are submitted to us

  • An IBI (Instant Bond Indicator) - supply to bond applicants an answer as to whether they qualify for home loan finance (as they are also linked to the credit bureau).

  • Offer up to 100% Loan to Value (LTV) on all loans including building loans to Nedbank as well as NON-Nedbank clients up to a value of R5 million

  • Capitalisation of the initiation fee for 100% LTV loans

  • The Direct channel has an official process in place to appeal loan rates and loan to value deals when we need to be more competitive

  • Automated upfront improved interest rates on quotation issued to clients

  • Nedbank Direct Channel also offer vendor commission to approved and qualifying Agencies
Author Benhard Wiese
Published 18 Oct 2019 / Views -
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