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Cape Town - There is hope for those who desperately want to buy a house even if their home loan application has been declined, according to property attorney Meyer de Waal.
De waal, who is the director at Oosthuizen & Co Meyer de Waal, told Fin24 in a video interview that there is a way for consumers to still get a bond even if they have been turned down by banks.
He said usually when a bond application is rejected; it is based on a client’s poor credit scorecard.
"Why do you need a bank from day one to conclude your transaction? Everyone is so fixed on going to a bank to get a home loan. We say, park the bond or the bank a little bit outside for a year or two.
“You've got a willing seller, you've got a willing buyer and you’ve got a property. Those are the most important ingredients to negotiate a transaction,” said De Waal.
He said the Rent-to-Buy concept is an ideal option in this situation.
Watch the full interview with Meyer de Waal:
“So you first rent your property. Then you sign a deed of sale from day one. But during that rental period you then have time to improve your credit status, negotiate a better interest rate ... and then once you've gone through a rental period, you can now go to the bank”.
De Waal pointed out that Rent-to-Buy is available to any piece of property. “You must just have a property, a seller and a buyer and later on we will negotiate with the bank.”
He also said that banks are open to this concept. “The banks love what we do ... we provide them with a solid application.”
De Waal explained that clients get a personal trainer and mentor. “We make sure that his budget meets his expenditure every month. We give him tools so that he can track his expenses, we give him home ownership education on top of that and we continue with the home ownership education after he has taken transfer”.
Watch the full interview for more about the rent to buy concept:
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