South African Mortgage FAQs
IPS Mortgages is a South African Mortgage Originator (see FAQs below). This means we provide a free service helping people like you apply for
finance (mortgages) with the South African banks.
Why use a Mortgage Originator
Most people ask why they should use a 'middle-man' in arranging something as important as a mortgage. The short answer is: you
should use a mortgage originator exactly because it is so important! We are on your side; we are there to
help you, the client. And it's a free service!
Mortgage originators have an intimate knowledge of the world of mortgage finance, as we specialise in arranging mortgages for
clients, day-in, day-out. We know which banks are offering which deals, are favouring which clients, are providing the best service,
and are favouring which particular areas (since they need to spread their 'lending risk' geographically). We also know which
information to include in your application, and how to present that information to maximise the strength of your application.
This all adds up to ensure we get you the best deal available.
Why use IPS Mortgages
So why use IPS, in particular?
In 2005, we helped overseas clients get over R100 million worth of fantastic mortgage deals. (Read our Testimonials
for some feedback). We specialise in assisting overseas clients in arranging finance. Back in 2004 we started to forge direct,
close relationships within the large South African banks, which paid dividends when we became the first mortgage originators to
secure 100% loans for our overseas clients, as well as being able to organise proper mortgage pre-approvals, as in approvals
direct from the banks, not just our own estimates of how much you could borrow!
(For more information on Mortgage Pre-Approvals, please contact us.)
Simply by speciliasing in this market, and by having local offices in London, Dubai and around South Africa, we are confident we will
provide the best service and help secure the best possible mortgage deal. Our knowledge of P45's, National Insurance,
umbrella companies, council tax, and other details of foreign employment means we have the edge in understanding the client's
situation, and structuring the best possible application to the banks. We also have an online Transaction Manager that lets
you see the progress of your Application, simply by logging in.
The difference between a 9.5% offer and a 9.0% offer, on a R1 million mortgage over 20 years, is more than R 75,000. Isn't
it worth getting the best deal available?
For more information, request a mortgage call-back, or read the FAQ's below.
Mortgage FAQs (Frequently Asked Questions)
What is the difference between a bond, a mortgage, a home loan and property finance?
Nothing - they are all terms for the same thing: the loan you take from a bank to finance a property purchase.
How much can I get as a mortgage?
That depends on a lot of different criteria. You have to provide a lot of information in the application process, and the banks will assess the 'risk' associated with your application, before offering you an amount. However, you can use the mortgage calculators on our website to get a rough estimate of how much you could qualify for.
Remember, a bank will also tell you what percentage of the property they are prepared to lend you. So they might lend you only 80% of the property, which means that you have to pay for the extra 20%, or the deposit.
If you would like to know how much you would qualify for, speak to us about getting a mortgage pre-approval.
Can I get 100% finance?
Possibly. We have helped many overseas South Africans get 100% finance - at a time when banks themselves were saying 80% was the limit! It's all about making the bank aware what risk they are dealing with. Obviously, terms & conditions apply, and you have to fit into some fairly strict criteria first, but speak to us and we can advise you.
What is a 'pre-approval'?
A pre-approval is where the bank looks at your details and decides how much they are willing to offer you. It's not set in stone, though, because the bank doesn't know which property you are going to buy (at that point). So the offer is not 100% guaranteed, but it gives you an excellent idea of what you can get, which can be a great tool for negotiating down the price of a property. Up until a very short time ago, banks were no longer offering pre-approvals, as their conversion rates were too low for it to be viable. However, we have managed to get a few of the banks to give this a rethink. Speak to us about getting your pre-approval!
You can also read this article for more information on pre-approvals.
What if I am not a South African?
Banks will usually only lend 50% to non-South Africans, i.e. you need a 50% deposit. We're doing our best to persuade them to increase this value. However, in certain circumstances, we might be able to get you more than 50%. Contact us to find out more.
Can IPS help me get a loan to purchase a South African property?
Absolutely. We are a 'mortgage originator' (also known as 'mortgage broker' or 'bond originator'). We can help you with your property financing requirements.
What is a 'mortgage originator'?
Mortgage originators (such as ourselves) assist applicants (such as yourself) arrange finance for properties through the banks. The banks pay mortgage originators a commission to process the applications. This reduces the amount of work that the bank has to do. Most mortgage originators will therefore not charge the applicant a fee for their services, as we are effectively working on behalf of the banks.
Why should I use a mortgage originator, like IPS?
Mortgage originators know the market very well. Effectively, we are mortgage specialists. We know which banks are offering what sort of deals to whom, for certain property types in certain areas. Confused? Ok. Let's try that again: after processing your mortgage application, a bank will offer you a deal - i.e. a specified amount at a specified interest rate. The amount and rate offered to you depends on a lot of different criteria, mostly based on your particular details, the details of the property, the base interest rate at the time, and the amount of (other mortgage) risk that the bank already holds in the area you are buying.
For example, if you earn a large salary, then the bank regards you as a lower-risk applicant, as you can afford the repayments easier than someone who earns less. The price you are buying the house for is also important, as a higher price means a higher risk for the bank. And lastly, if (say) Nedbank has given 10,000 mortgages out for properties in Randburg, but FNB have only 1,000, then FNB could offer a better deal as they have less risk in that geographical area.
There are a many, many more factors taken into account than mentioned above. A good mortgage originator, though, will know which bank is likely to offer the best deal for your particular application. And a good mortgage originator can offer impartial & expert advice, and can also 'motivate' your application on your behalf, to secure the best possible deal - at no cost to you at all!
What does a mortgage originator charge?
Usually, mortgage originators don't charge the applicant a cent. IPS certainly doesn't. This is because the mortgage originator gets paid a commission from the bank.
Why should I use IPS ahead of other, South African origination companies?
We pride ourselves on the work we have done on behalf of our clients. We are an excellent mortgage originator - at least, we like to think so! We have offices in London and South Africa, so you save on postal/courier costs, plus we are experts at mortgage applications for South Africans living abroad and for non-South Africans. We don't charge a fee, and we provide an efficient, online service. And most importantly, we always work with our clients interests as our top priority.
We are constantly pushing the boundaries with the banks on our clients' behalf - we recently persuaded some of the banks to offer 100% finance to our overseas clients, and we have also been successful in lobbying some of the banks to provide mortgage pre-approvals, both at a time when this was unheard of in the mortgage origination industry!
At IPS, we specialise in raising finance for off-shore investors. 99.5% of mortgages for most SA-based origination companies are for SA-residents, whereas we deal almost exclusively with investors in the UK, Ireland, Germany, France and the rest of the world. We understand the subtle differences - P45's & P60's, umbrella companies, etc. Our contacts in the banks are also familiar with these variations, and are thus more adept at processing such applications. We have even helped get some of the banks to create "international channels", with staff dedicated for this purpose only.
In fact, it's more a question of why shouldn't you use us.
So what is the difference between a mortgage through IPS and a mortgage through the bank?
Nothing. The mortgage will be awarded to you by the bank. We provide a service to make sure you get the best deal available. And if you do the calculations, you'll see that even a tiny difference in the details can add up to a massive sum over the life of the mortgage.
Which banks do you work with?
We work with all the major banks in South Africa - Standard Bank, First National Bank (FNB), Nedbank, ASBA, SAHomeloans, etc. (These banks represent approximately 96% of the mortgage market). We are also able to assist with applications to the private banks, Investec & Rand Merchant Bank (RMB).
Our preferred partners:
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