27 Jun 2013
Two Property24 readers ask questions about how one party to a home loan can be released so that the other is free to apply for a new bond of their own.
Michele Bovet, Marketing Manager at SA Home Loans, advises:
Q 1. I would like to know if the joint partner in a home loan wants to withdraw from the joint bond, is that possible? For instance my sister who needs to buy her own house. How do we go about this?
A. It would depend on the type of bond, direct or indemnity. Direct bonds allow endorsements, while indemnity bonds would need to be cancelled and re-registered. It would also depend on the relationship of the bondholders.
In all instances all bond holders have to contact their financial institution (bank), who would then conduct a full credit and affordability assessment to ascertain whether one of the bond holders may be released. Once they have completed their assessment they will either approve or decline the request.
Q 2. I am in a joint bond with a friend. He pays for it and stays at the house alone as the only reason why I did it was to help him since he could not qualify alone on his salary. We recently agreed to have my name removed, however, each time we need to go to the bank he does not honour the appointment. Is there any way that I can make my submission for the withdrawal alone to the bank? This is impacting negatively on my life as I cannot get a home loan.
A. As the mortgage loan was granted and registered in the name of two parties, unfortunately any change request to the original agreement has to be actioned by both parties.
In order to have one party removed off the loan, the financial institution needs to conduct a full credit and affordability assessment to ascertain whether one of the bond holders may be released.
Readers may submit questions to Property24’s Guest Expert panel and/or comment below. We may not be able to answer all questions received, but all will be considered.
Michele BovetMichele Bovet is the Marketing Manager at SA Home Loans. SA Home Loans was launched in 1999 and is the largest non-bank home loan provider in South Africa.
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