special edition .bankii.dhhnoe matters.pdf · special edition your monthly loan instalment is...
TRANSCRIPT
x
Money Matters
www.bankwindhoek.com.na
Special Edition
Guide to home ownership
Bw
11/
324
Every family requires a secure place of living which they can call home.
For many of us one of the biggest purchase transactions one would conclude in a lifetime would be to acquire your own home. The benefit of owning your own home may be that you will have a secure place for you and your family and that nobody can remove you from your property, provided that you meet all your commitments regarding your property.
You need to establish what your family’s accommodation requirements are before you select a property. Should you plan to extend your family, consideration should be given to extension possibilities within affordability limits.
The purchase price of a property is normally financed by a bank on application for a home loan. The property purchased serves as security for the loan and the bank registers a mortgage bond at the Deeds Office against such property to endorse the property as security. The mortgage bond is registered following the transfer of the property into the name of the purchaser. The proceeds of the loan can only be disbursed after such a bond registration.
There are two types of home loans, namely a loan on an existing property called an ordinary loan, and a loan known as a building loan which is on a property still to be built. In the case of an ordinary loan, the full purchase price is paid on date of transfer and bond registration, where after the monthly repayments commence. Whilst on a building loan, the cost of the land (erf) is paid on date of transfer and bond registration, and the cost of construction is paid in intervals as the construction work progresses. Normally repayments commence once 50% of the proceeds of the loan is paid out, in order to counter interest charges absorbing the available loan balance.
There are various costs involved in transferring the property into your own name as well as registering a mortgage bond.
The biggest portion of these costs relates to transfer duty and stamp duty payable to the Ministry of Finance. However, transfer duty is only applicable when the purchase price of the property exceeds N$400 000.
These costs can be added to the loan amount, provided the valuation of the property can accommodate the loan amount as well as the total costs. Otherwise the purchaser needs to contribute a portion thereof out of own funds.
The average costs for loans up to N$1 million is about 5% of the loan amount, 6% for loans up to N$1,5 million and 7% for loans up to N$2 million.
introduCtion
ACCommodAtion reQuirements
FinAnCinG the purChAse priCe
tYpes oF home LoAns
Costs inVoLVed when purChAsinG A propertY
A subsidiary of Bank Windhoek Holdings Limited
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Money Matters
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Special Edition
Your monthly loan instalment is calculated according to the interest rate and repayment term of your loan, including provision for insurance and assurance premiums.Repayment terms are normally 20 years, depending on your age and remaining period until retirement. Should you retire within the next 15 years, your repayment term will only be 15 years.The interest rate on home loans may vary between 10,75% and 11,25% depending on your employment benefits.The factors used to calculate your monthly home loan instalment per N$1 000 loan amount is as follows:
method:Say for instance you applied for a loan of N$165 000 over a period of 15 years at an interest rate of 11,25%, you multiply the factor of 11,52 by 165 ( being the number of N$1 000’s in the loan amount) and you get to an amount of N$1856.25 representing your basic monthly instalment.
Provision for insurance premiums can be added to this basic instalment by dividing your annual insurance premium by 12 to get to a monthly contribution. The basic instalment needs to be adjusted accordingly.
In some instances you may be in the fortunate position that your employer is supporting you to obtain a home by entering into a housing scheme with the bank. You may receive a monthly allowance or subsidy to assist you in affording the monthly loan instalment. Such subsidy / housing allowance is set off against your monthly loan instalment, reducing your own contribution and as such allowing you to afford a bigger home loan on a better property.
CALCuLAtinG Your monthLY instALment
AFFordABiLitY
inCome & eXpenditure stAtement
term in YeArs interest rAte FACtor10 10.75% 13.63 15 10.75% 11.2120 10.75% 10.1510 11.25% 13.9215 11.25% 11.5220 11.25% 10.49
inCome & eXpenditure stAtement continued on next page...
A subsidiary of Bank Windhoek Holdings Limited
Proof of income is required.
To enjoy the benefit of owning your own home, you need to ensure that the cost of your home is not putting financial strain on you and your family.
To avoid this, is of utmost importance. That is why you should do proper financial planning and budgeting by compiling a monthly income and expenditure summary.
A draft summary is reflected for your convenience and can be adapted to represent your situation. It will be to your own benefit to compile it as comprehensive as possible, otherwise you may struggle to afford the monthly installment.
inCome
Own nett income Basic – N$ N$
Spouse nett income N$
Other income N$
Commission N$
Rent N$
Total income N$
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Money Matters
www.bankwindhoek.com.na
Special Edition
inCome & eXpenditure stAtement continued from previous page...
Your monthly surplus should exceed N$1 000.00 in order to provide for unforeseen expenses possibly caused by breakages or accidental damages.
eXpenditure
details Current payment
Bond payment
Body Corporate levy
Rent payment
Personal loan
Personal loan (Spouse)
Car payment
Car payment (Spouse)
Short term insurance premium
Life & other policies premiums
Credit card payment
Petrol & maintenance
Child / Wife maintenance
Clothing accounts
Water & lights
Rates & taxes
Telephone accounts
Cell phone accounts
M-Net & or DStv
Domestic salary
Groceries, meat etc
Savings & investment
Spending money
Bank charges
Other
Total expenditure N$
Total Surplus / shortfall N$
A subsidiary of Bank Windhoek Holdings Limited
x
Money Matters
www.bankwindhoek.com.na
Special Edition
responsiBiLities Homeownership requires various responsibilities, namely honouring monthly commitments, arranging insurance and assurance, proper maintenance etc.
monthly commitments: Monthly commitments include the payment of your loan installment to the bank, the payment of rate and taxes, electricity and water usage to the Local Authority, the payment of insurance and assurance premiums, as well as the cost of maintaining your property on a regular basis.
insurance:The financial institution financing the purchase of your property take the property as security for the loan, and therefore it is required that the property (the security) is protected against fire and other possible damages caused by accident, rain, water, flooding etc. Such insurance is utilised to repair and reinstate the property in the same condition as it was before the damage. Refer to the conditions contained in the policy.The insurance premium can be added to your loan and recovered from you by means of an increased monthly loan instalment.
Assurance:Assurance represents a life insurance policy on your life for the value of the loan amount. In the unfortunate event of your death, the proceeds of the life assurance will be utilised to repay your outstanding loan balance, leaving your loved ones (your family) with an unencumbered home to live in, without the burden of monthly repayments.The life insurance premium can either be paid by yourself or added to your loan account and recovered from you on a monthly basis by means of an increased monthly instalment.
maintenance:As a homeowner, you are responsible to keep your property in a good condition by repairing small ‘breakages’ as they occur, such as leaking water taps, running toilet cisterns, blocked gutters, roof nails are sealed and secured on a regular basis to avoid roof leaks, foundations are protected from being exposed by wind or rain, cleaning of carpets, periodic repainting, replacing broken window panes, fixing loose cupboard doors, installing security systems etc.The proper maintenance of your property is one of the main contributors to the value of your property.A well maintained property is not only an appreciated asset, but also a pride to you and your family.
Homeownership is a comprehensive issue. That is why homeowners should take the necessary precautions to protect and maintain their own property, and in doing so, build up a valuable asset for many years to come.
Should you require any additional information, you are welcome to call any of our branches countrywide, who will gladly assist you.
ConCLusion
ContACt us todAY:
“toGether we do Better”
Namib BouP.O.Box 6102AusspannplatzWindhoekNAMIBIA
Ludwig KleinTel: (061) 299 0546Fax: (061) 299 0595Email: [email protected]: www.cih.com.na
A subsidiary of Bank Windhoek Holdings Limited
(STREET) 20m
New house
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EXTENSION 18
EXTENSION 20
EXTENSION 17
EXTENSION 19
(STREET) 12m
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DISCLAIMER: THE PROJECTED FLOODLINE
AS INDICATED ON THIS DRAWING SHOWS
THE HIGHEST WATER LEVEL UPON
STORMWATER MITIGATION MEASURES AS
COMPLETION OF BULK EARTHWORKS AND
PROPOSED BY LITHON PROJECT CONSULTANTS
REMAINDER OF THE FARM
NDANGWA TOWN AND TOWNLANDS NO.882
148
P.O.S
PHASE 1
EXISTING HOMESTEAD
WATER PIPELINE
TELEPHONE LINE
EXTENSION BOUNDARY
0
1
0
0
0
142
SPACE
RESIDENTIAL
PUBLIC OPEN
CIVIC
INSTITUTIONAL
BUSINESS
GENERAL
RESIDENTIAL
LEGEND: PHASE 1
IN ASSOCIATION WITH:
ONDANGWA TOWN COUNCIL
ON BEHALF OF:
SEPT 2011
CLIENT:
DESIGN:
624/NAMIB NOU/Phase 1_Amend_Sept11
SRM: ROOT DIRECTORY/ SUB DIRECTORY/ DRAWING NAME
UPDATED:
DRAWING NUMBER
624/ONDANGWA/Phase 1
SCALE
1 : 5 000
DRAWN: URBAN DYNAMICS
ORIGIN OFFSET
COLOUR PALETTE
DATE
DATE SEPT 2011
Notes:
45 NELSON MANDELA AVENUE
The copyright of this drawing is reserved
Namibia E-mail: [email protected] Telefax :+264-61-240309P O BOX 20837 Telephone :+264-61-240300
KLEIN WINDHOEK, NAMIBIA
SURVEY:
PREPARED BY:
ONDANGWA
PROPOSED PHASE 1:
PROJECTED FLOODLINE
PHASE 1 BOUNDARY
MOVEMENT
CEMETERY 0
EXTENSION 17
Hs 15
Hs 19
Hs 21 Hs 20
Hs 18
REM
/PTN
A (S
TREE
T) 25
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(STREET) 15m
(STREET) 20m
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CHURCH P.O.S
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EXTENSION 17
(STREET) 12m
(STREET) 12m
(STREET) 12m
(STREET) 12m
(STR
EET)
25m
ONSULTANTS
EXISTING HOMESTEAD
WATER PIPELINE
TELEPHONE LINE
PORTION BOUNDARY
LEGEND: TOTAL AREA
IN ASSOCIATION WITH:
ONDANGWA TOWN COUNCIL
ON BEHALF OF:
JULY 2010
CLIENT:
DESIGN:
624/NAMIB NOU/DRAWINGS/LAYOUT_AUG/LAYOUT_TB_Final
SRM: ROOT DIRECTORY/ SUB DIRECTORY/ DRAWING NAME
UPDATED:
DRAWING NUMBER624/ONDANGWA/EXT.17
SCALE
1 : 800
DRAWN: URBAN DYNAMICS
ORIGIN OFFSET
COLOUR PALETTE
DATE
DATE JULY 2010
Notes:
45 NELSON MANDELA AVENUE
The copyright of this drawing is reserved
Namibia E-mail: [email protected] Telefax :+264-61-240309P O BOX 20837 Telephone :+264-61-240300
KLEIN WINDHOEK, NAMIBIA
SURVEY:
PREPARED BY:
ONDANGWA
PROPOSED PHASE:1EXTENSION 17
PROJECTED FLOODLINES
PHASE 1 BOUNDARY
CIVIC USE
PLEASE NOTE:
HOMESTEAD 21 OPTED TO BE RELOCATEDAND WAS NOT ACCOMMODATED IN LAYOUT