Should You Keep Your Bond Open

Most people let out a deep sigh of relief when they reach that point of making the final payment to their bond and do so with glee, finally getting rid of the 'home loan yolk' from around their necks.

However, many people ask if there is an advantage to keeping a bond or home loan facility open. The answer is yes, if you think that you'll need to access large amounts of credit in the future.

All you have to do is owe the bank a nominal amount (R10 for instance) and your bond facility will be kept open should you need to access funds for whatever reason.

Even if you have no intention in investing in or purchasing anything large in the near future, it won't hurt to have your home loan facility at your disposal should you ever need it.

Remember that if you close out your existing home loan it will cost you to apply for and register a new one. By keeping your existing bond facility open, it will always be there for you and is the most cost-effective form of finance you can get.

Another benefit of keeping your bond open is that while your bond remains open, your bank will retain the title deeds to your property, where they will obviously be well-kept and safe.

If you close your bond, however, you will be sent the deeds to your property and you will personally have the responsibility of finding a new safe and secure place to keep them.

The bottom line is that its up to you whether to keep your bond open or not. The point is to make sure that you give it some thought before you make your last payment.

Related Insurance Articles:
* Using a Home Loan Originator
* Home Loans Basics
* Home Loan Transfer Duties
* Home Loan Options
* Home Loan Interest Rates
* How To Use Your Bond As A Financial Resource
* First Time Home Buyers Missing Out On Best Bond Deals
* Renovating To Increase The Value Of Your Property

3/7/2008 4:04:57 PM