More bad business…

More bad business…

Flipping banks! Was chatting with a client yesterday who was relating his sorry tale of applying for a bond…here are the facts; you decide if this is ok!

Net income – R45000, bond applied for R1075000 on 10th Jan 2011 (house value – R1.56million, deposit – R485000). The banks replied as follows:

  • ABSA – “our bond people are off until Feb so we can only let you know then”.
  • Nedbank – “your primary bank account is not with us so we wont consider the bond” (this is so doff because a current account would only bring them about R900 in fees for a whole year).
  • FNB – did not bother to reply to the request (business must be really great).
  • Standard Bank – “yes, we will give you a bond but the rate will be prime +2.5%” (they are smoking their socks).

So the client went to SA Home Loans…bond approved and granted (effectively at prime less 1%)! Well done to SA Home Loans.

SA banks really need a big wake up call…sure we dont want to see them lending recklessly but we also dont want them to be complete idiots about not lending either.