SA Home Loans

SA Home Loans

SA Home Loans `broke` into the highly competitive South African home loan market in 1999 by offering South Africans a generous interest rate 19.6 percent as opposed to the high national interest rate of 23.5 percent, providing some relief to cash-strapped home buyers.

Since then, SA Home Loans has earned itself a reputation for offering South African home buyers much-appreciated `savings` in terms of their home loans, as well as launching some pioneering home loan products that has cemented the company`s place in the South African home loan market.

For instance, in 2005 its was SA Home Loans that introduced a 20-year fixed rate home loan, a product that is unique to this home loan originator which also prides itself on offering prospective home buyers excellent service through its highly-motivated and trained staff.

Just last year (2006), SA Home Loans also launched its unique Interest Only option, where clients have the flexibility of paying only the interest portion of their monthly home loan installments, and being able to pay the capital repayments at their convenience.

Why SA Home Loans?

As South Africa`s first non-banking, discount home loan originator or provider, SA Home Loans, processes home loans differently to banks, by linking borrowers directly to the money markets and, in effect, bypassing the traditional `middlemen` in this case the banks.

In other words, SA Home Loans offers mortgages in the traditional sense, as opposed to bonds.

Known as `securitisation`, this alternative form of home loan funding has proved to work successfully around world including in the United States, where it is estimated that as high as 40 percent of all debt is securitised.

During the past 5 year, SA Home Loans has launched six Residential Mortgage Backed Security structures or Special Purpose Vehicles (called Thekwenis) with a collective value of just under R10 billion, and which are `insolvency remote` i.e. remote from any risk of voluntary or involuntary insolvency proceedings.

In  a nutshell, what SA Home Loans does is arrange and manage the securitisation process by repackaging individual home loans into a pool large enough to attract fund managers as well as institutional investors seeking reliable and solid long-term investments.

They are provided with an opportunity to diversify their bond portfolios to include the opportunity to purchase income streams from the collection of underlying mortgages in a Thekwini, a different option from regular investments such as corporate and government bonds.

This way of generating home loans for South Africans has helped maintain SA Home Loans competitive advantage in the residential home loan market.

SA Home Loans Convenience

SA Home Loans has over 700 staff members in 16 offices nationwide which means it has the workforce, reach and means to process home loans on behalf of South Africans from all walks of life based just about anywhere in the country.

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7/30/2008 9:45:11 AM