What happens if I can't afford to pay my bond?

If you are experiencing financial difficulty and you can’t afford your bond repayments, instead of just hoping it will resolve itself, you should approach your bank as soon as possible. You do this to try and make alternative payment arrangements. 

Can you extend your bond period?

Alternative payment arrangements could include extending your bond repayment term over a longer period. For example, if your current bond term is over 20 years, you could request that it be paid over a long term (30 years) and this will reduce your monthly repayment. 

Moku Tip: Do not wait until you default on your home loan, act before then. 

A few other alternative arrangements a bank may suggest if you’re unable to pay your home loan:

• They may offer you a short-term repayment plan. Absa offers this if you’ve had your home loan with them for 9 months or longer. 
• They could help you sell your property so that you can avoid missed payments and arrears that may accumulate. 

Can I pause my home loan?

While you can't request a payment holiday, you may ask the bank to come up with a short-term repayment that can help you get out of the rough patch you're currently in.

Can you borrow against your bond?

You can usually borrow money against your bond if you’ve paid more money—usually more than the minimum monthly bond instalment—into your home loan. This facility is usually referred to as an access bond. By paying more money into this account, you can request to use it for any short-term expenses you may have, as opposed to opting to take out another personal loan. 

How much money can you borrow against your bond?

You can only borrow the extra amount you’ve paid into your bond. This means that if you’ve paid R3000 extra towards your bond for the year, and you request access to these extra funds, you will only have access to R3000. 

Is skipping a payment a good idea?

Skipping a home loan payment, or any debt repayment for that matter, is never a good idea. This will be recorded on your credit report and can stay on the credit report for 7 years. It could also negatively affect your credit score. In turn, this could affect whether you get approved for credit in the future and the interest rate you could get approved with. 

What happens if I can't pay when the loan is due?

1. Contact your home loan provider for alternative payment arrangements.
2. Consider that you may be over-indebted. If you are facing financial trouble and you need help to pay not only your bond, but your other monthly debt obligations too, we can assist you before a bank starts legal proceedings against you. How? With debt review.

Let us determine whether or not you actually are over-indebted. Following this, we can work out a restructured repayment plan for all your debt. This could end up saving you up to 50% on your monthly debt instalments! The best part is that we get a court order based on your new repayment plan, which means that your house and your car are protected from repossession.

Protect your house from repossession! Go under debt review today!

What is the grace period for a bond?

This will differ depending on the credit lender or bank you have your home loan with. 

How long does it take for a bank to repossess a house in South Africa?

As with any credit agreement, a bank will first have to issue you with a Section 129 Notice before they can start with legal proceedings against you. This letter of demand can be sent to you 20 days after you’ve defaulted on your credit agreement (home loan). 

It’s important to note that your home could get sold at an auction for less than what it is actually worth, and you would still be liable for that outstanding debt. 

A bank will usually start legal proceedings and the repossession process after three or more months missed payments.  

GO UNDER DEBT REVIEW BEFORE YOUR HOME GETS REPOSSESSED.