How to keep your home when you can’t pay your bond


You need to be proactive

Reassess your situation and make adjustments

Don’t let pride trip you up

Admit that you need help

Contact your bank

contact your bank

Fear of your home being repossessed is probably unfounded. But defaulting on your bond repayment will not only result in you potentially losing your property, it will also affect your credit record and lead to black listing. A negative credit record can make renting a property difficult as most landlords do credit checks on potential tenants.

Banks will often assist homeowners where they can by possibly rescheduling the debt or offering financial advice.

Some banks offer payment holidays in the case of retrenchments, maternity leave and where a lump sum pay-out from life insurance or an inheritance is expected in the near future. These can vary from one to ten months. Bond holders are not penalised in any way with, for instance, higher interest rates or longer payment terms. Customers are encouraged to make arrangements to repay the arrears amount – from a single lump sum payment to payment over a period not exceeding 12 months. The arrangement will include the normal monthly repayment plus a percentage of the arrears.

Stretch the term of the loan

stretch the loan

In certain instances banks may renegotiate the term of the loan from 20 years to 30 years to decrease the monthly bond instalment amount.

Do you need a debt counsellor?

If the situation has deteriorated beyond the homeowner’s capabilities, they are advised to consult a professional debt counsellor for a possible solution. Once the counsellor has assessed the situation they will be able to submit a repayment proposal to all the relevant creditors. An application will then be made in court to have the proposed repayment plan granted to ensure that legal action cannot be taken against the homeowner and the bank will not be able to repossess the property.

Keep in mind that you have a legal obligation to fulfil the terms of your bond agreement and you remain responsible and liable for any outstanding balance on the loan account, including the cost of the judgement.

The bank will only initiate the repossession route to resolve the matter after all options suggested by the bank have been exhausted.

Sell your distressed property

sell your property

If you can’t keep your home, put it on the market.

Selling the property through the distressed property channel is an effective way to recover. Contact an estate agency that handles distressed property sales. The banks do work with reputable estate agencies to sell distressed properties at market-related prices. If you have built up some equity, there may be enough money to cover your outstanding bond, as well as all or some of your other debt. This option could help you to re-establish yourself and your credit record.


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