In South Africa, your credit profile is one of the most important tools lenders use to assess your ability to manage debt. But have you ever wondered how your credit information actually gets to the credit bureaus — and why sometimes, not all the bureaus have the same information?
Buying a home in South Africa is one of the most significant financial decisions many people make. Whether you’re a first-time buyer or a seasoned homeowner, your mortgage (also known locally as a home loan) is likely to be your largest long-term debt. Understanding how mortgage interest works — and how to pay less of it — can help you save hundreds of thousands of rand over time.
When most South Africans apply for a home loan, they're told the basics: improve your credit score, keep your debt-to-income ratio low, and ensure you can afford the repayments. But what happens behind the scenes once your application hits a bank’s credit risk engine is far more complex — and it's grounded in advanced statistical analysis, predictive modeling, and geographic risk profiling.
This article explores how banks in South Africa assess home loan applications through a lens of statistical risk mitigation, going beyond the surface-level criteria and into the data-driven processes used to manage exposure to default.
It happens far too often: a hopeful homebuyer applies for a bond, only to be told that their application was declined—without a proper explanation. Many people assume that’s the end of the road, and they walk away discouraged, confused, and unsure of what went wrong.
But here’s the truth: You have the right to know why your application was declined. In fact, South African law is very clear on this.
Wondering if you can use Airbnb income in your home loan affordability assessment? Maybe, it absolutely depends on the bank’s requirements and the paper trail of evidence you have to show the average income you earn from Airbnb.
The Financial Sector Regulation Act (FSRA) of 2017 in South Africa is a key piece of legislation that establishes a system of financial regulation, with the aim of preserving and enhancing financial stability, improving market conduct, and protecting financial customers. It also creates the Prudential Authority (PA) and the Financial Sector Conduct Authority (FSCA), which are responsible for regulating and supervising financial institutions and financial products.
The Financial Advisory and Intermediary Services (FAIS) Act 37 of 2002 is a South African law that regulates the financial advisory and intermediary services industry. Its main purpose is to protect consumers of financial products and services, professionalise the industry, and ensure that financial service providers act in a competent and ethical manner. The act applies to many intermediaries, including insurance brokers and mortgage brokers.
The National Credit Act (“NCA”) of 2005 is a law designed to regulate the consumer credit market in South Africa. It aims to promote a fair and accessible credit environment, protect consumers, and encourage responsible credit practices. How does that shape the landscape for consumers?
Congratulations, your home loan was approved! Now what?
It’s time to start planning to move into your new home, or get a tenant for your investment property, and prepare for your very first home loan repayment. It’s essential to meet the deadline for every repayment on your home loan to ensure your credit score stays in tact and your chances of applying for more credit are not affected.
Most consumers are aware that any lender in South Africa doing a credit check on their personal profile could negatively affect their credit score. While this is true in some circumstances, it’s important for consumers to understand when it applies.
There are certain types of credit checks that affect a customer’s credit score, and some credit checks that will not affect scoring at all.
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