Buying a home – ‘this is the right time’
African Bank on why now is the right time to buy a home as well as tips for improving your credit score.
Now is a great time to buy a home as interest rates are at an all-time low, suggested Sbusiso Kumalo, Chief Marketing Officer for African Bank.
“With lower property prices and interest rates prospective homeowners will be able to pay off their bond over a 20-year period and save money on interest. Of course when applying for a bond, all banks will review your credit score and this is where a good score is either going to come back and delight you or adversely, haunt you.”
Kumalo said one cannot stress enough the importance of a good credit score, not only when applying for a bond, but also if you are just considering renovating and need a loan to make the necessary improvements.
If you have a low credit score you are likely to struggle to get a loan at any store or bank, whereas a higher credit score increases your ability to access credit, like a favourable bond or loan.
“Understanding how your credit score is calculated will give you insight into how companies view you according to your credit history and how you manage your money. It also allows you to confirm that all debts against your name are correct,” he said.
Three tips for improving your credit score:
1. Access a free credit report and make sure the information is correct
2. Pay your accounts on time. The easiest way is to set up automated bank payments
3. Track your monthly expenses with a budget and save for emergencies instead of having to take out another loan to pay unexpected expenses
“By improving your credit score you improve your overall finances, which is a positive when it comes to applying for a loan and having peace of mind that you are ready for this financial commitment,” said Kumalo.
If you secure a home loan, keep your credit record clean so that you are able to apply for credit to make improvements to your home to up its value.”
Here again Kumalo cautioned when it comes to value.
“It is really key to make sure you know how much you need to make the right improvements and then ensure you get sufficient credit.”
