Step 1 — Get pre-qualified before you shop
Pre-qualification tells you how much a bank is likely to lend you, based on your income, expenses and credit record. It is not a guarantee, but it gives you a realistic price ceiling and makes your offer far more credible to sellers and estate agents. A registered bond originator can pre-qualify you for free and, later, submit one application to several banks at once.
Before you start, pull your credit report and clear up any errors or arrears. Lenders look closely at your repayment history and your debt-to-income ratio. As a rule of thumb, your total monthly debt repayments — including the new bond — should not exceed roughly 30% of your gross monthly income.
Step 2 — Find the right property
Once you know your budget, factor in the costs on top of the purchase price. Transfer duty, conveyancing and bond registration fees can add tens of thousands of rand that the bank generally will not finance. Use our bond & cost calculator to see the full cash figure for any price you’re considering.
Look beyond the asking price: rates and taxes, levies in a sectional title scheme, the condition of the roof and plumbing, and the area’s resale history all affect the true cost of ownership.
Step 3 — Sign the Offer to Purchase (OTP)
The Offer to Purchase is a legally binding contract. Once both you and the seller have signed and any conditions are met, you are committed to the sale. Read it carefully — ideally have an attorney check it — before you sign. A good OTP clearly records:
- The full purchase price and the amount of any deposit;
- Exactly what is included in the sale (fixtures, fittings, appliances);
- The occupation date and any occupational rental;
- Who appoints the transferring attorney;
- The suspensive conditions and their deadlines.
Step 4 — Understand suspensive conditions
A suspensive condition is something that must happen before the sale becomes fully binding. The most common one is a bond approval clause: the sale only proceeds if you are granted a home loan for a stated amount within a stated number of days (often 21 days). If the condition is not met in time, the agreement lapses and your deposit is refunded.
Other typical suspensive conditions include the sale of your existing home first, or a satisfactory home inspection. Never waive a bond condition lightly — it is your main protection if finance falls through.
Step 5 — Apply for your home loan
With a signed OTP in hand you apply formally for a bond. You can approach each bank yourself, or use a bond originator to submit a single application to all of them and compare the offers. Banks assess affordability and then make an offer that specifies the approved amount, the interest rate and the term (commonly 20 or 30 years).
Compare offers on the interest rate first — even 0.5% over 20 years is a large sum. A bigger deposit usually earns you a better rate because it lowers the bank’s risk.
Documents you’ll typically need
- Certified copy of your ID
- Latest three months’ payslips and six months’ bank statements
- Proof of residence not older than three months
- A signed copy of the Offer to Purchase
- For the self-employed: financials and personal statement of assets
Step 6 — Attorneys, registration and transfer
Three sets of attorneys are usually involved: the transferring attorney (handles the transfer of ownership and is paid by you), the bond attorney (registers your bond for the bank), and sometimes the cancellation attorney (cancels the seller’s existing bond). They work in parallel, then lodge the documents at the Deeds Office together.
From acceptance of the offer to registration usually takes around 8 to 12 weeks, depending on how quickly conditions are met and how busy the Deeds Office is. On registration day the property becomes legally yours, the bank pays the seller, and your monthly bond repayments begin. To understand exactly which costs you pay to whom, read our transfer costs explained guide.
Budget for the costs the bank won’t finance
The single biggest mistake first-time buyers make is forgetting the up-front costs. Banks finance the property, but you must pay transfer duty, conveyancing and bond registration fees in cash. On a R1.5 million home these can total well over R50,000. Run your numbers on the calculator before you commit, and check the FAQ for answers to the most common questions.