Finance: Absa to Fund Home Improvements
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The financing of government subsidised houses, now known as “Breaking New Ground” (BNG) and the old four roomed township houses, is aimed at assisting those who cannot afford to buy a new house, but are able to upgrade their houses.
“Extending is one of the most cost-effective ways for home owners to upgrade. Building on means they do not have to buy a new home which will require an even larger loan,” says Luthando Vutula, Managing Executive for Absa Homeloans out of Gauteng.
“The current slow-down in new housing developments, as a result of escalating building costs, a shortage of land as well as a variety of other factors, has resulted in fewer new houses available for delivery.
“We realised many home owners want to improve their lifestyles and building onto an existing house is cheaper than buying a new property and makes good economic sense in the current, tough financial times.
“Home owners can now add a garage, a living room, kitchen or bedroom or another storey to an existing single-storey house.
“But the Absa loan can also be used for other purposes, for example, to consolidate short-term debt or to fund school or tertiary education,” Vutula says.
Loans can be for any amount between R20 000 and R400 000, depending on the borrower’s monthly income and the current value of the property. Up-front costs such as bond initiation and registration fees can be built into the loan, if the borrower prefers such an arrangement and meets the necessary credit-scoring requirements.
Absa is passionate about home ownership and understands the importance it has in creating a secure environment for the wellbeing and growth of our communities.
Absa in collaboration with the Department of Housing launched a BNG competition in May 2008 where home owners of old RDP and new BNG houses can upgrade and add onto their existing properties.
These home owners can then enter their properties into their respective regional competition. A winner in every region will be identified and stands a chance to win a prize money of R10 000. Options to finance these upgrades are available at Absa.
For more information SMS your full name to 32916 and a service consultant will contact you with more information on finance options as well as competition details.
“In addition, we have set up Borrower Education programmes and recommend that all customers attend those sessions,” says Vutula.
The Borrower Education programme is solely linked to the Absa MyHome product. One of the loan conditions is that customers undergo Borrower Education in order to have sound knowledge of how a home loan is managed as well as the processes involved when purchasing a property or applying for extensions.
“This programme will give them the necessary knowledge to enable them to make informed decisions about a home loan, their finances and how to wisely get the lifestyle they desire,” says Vutula.
“Knowledge leads to greater financial independence as well as sound financial practices. It reduces the risks to both the bank and the client.”
“Owning and improving a home is the platform on which personal wealth is built and we are committed to doing everything possible to help the millions of South Africans previously excluded from the mainstream economy, do just that.”
For more details about how you can finance extensions and renovations to your home as well as how Absa Home Loans finances non-traditional building methods, visit any Absa branch or phone the Absa call centre based in Gauteng on 0860 111 007.
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