Look, we all have gone through financial difficulty or a rough patch, if you find that you can't afford to pay your bond, the first thing you have to do is approach your bank or the financial institution with whom you've taken the bond. This should happen BEFORE you actually miss the bond repayment.
How do you ensure you communicate with your bank before you miss a bond repayment?
It's so important to budget before you even get your monthly salary so that you know how you will spend your salary and if you have enough money to pay all your debt. This way you will know if you can actually afford to make your bond repayment for that upcoming month.
Don't have a budget yet? Download our FREE, customisable budget template here.
Now, once you know that you can't afford your bond for that next month, contact your bank immediately.
How many payments can I miss on a bond?
Ideally, you really shouldn't be missing any payments on a bond because you will incur interest and make it even more difficult to catch up with the repayments of your bond.
You will also have a flag on your credit report indicating a missed payment and this could stay on your credit report for up to 7 years!
When can a bank repossess your home in South Africa?
A bank will start legal proceedings against you for missing your bond repayments usually after 3 or more months of missed payments. Repossession of your home would be a last resort, but it is definitely possible if you have consistently defaulted on your repayment of your home loan.
It's also important to remember that even if your home is repossessed and auctioned, it is usually sold at a lower price which means that you could still have debt owing on your home loan even after repossession.
The bank may suggest the following alternative solutions if you can't pay your bond
- Extend your bond period
- If you, for example, are currently paying your bond over the period of 20 years, the bank may recommend you extending your bond repayment period to 30 years. This will reduce your monthly bond repayment and may provide some relief when paying your debt.
- Assist you with selling your property
- The bank may assist you with selling your property so that you do not miss payments and so that arrears (money that is owed and should've been paid) does not accumulate.
If you have already missed bond payments, the bank may suggest:
- Respread of your arrears
- The bank may suggest you respreading the amount you are in arrears over a few months so that you are repaying a portion of your arrears amount and your bond instalment each month.
- Payment holiday
- Depending on the financial institution, they may suggest a payment holiday for a portion or the entire bond amount for a few months.
- This will mean that you will incur interest and service fees so that when you do start paying after the payment holiday, so your new bond repayment will be more than the original amount.
An alternative solution that could end up saving you up to 50% on your total monthly debt instalment
Here your total debt amount is not just your home loan. Usually if you are struggling to keep up with your bond repayments, you are very likely to be struggling to keep up a few of your other debt repayments too. If this is you, we could save you up to 50% on your total monthly debt instalment which means that you could have an affordable monthly debt instalment for not only your home loan, but your other debts too!
"You could have an affordable monthly debt instalment for not only your home loan, but your other debts too!"
How can we save you 50% on your total monthly debt instalment?
We could do this with debt counselling. Debt counselling is a legal debt relief programme that helps South African consumers, like you, who are struggling to make their debt repayments.
How does debt counselling work?
First our expert Debt Counsellors will assess if you are really unable to make your monthly debt repayments. We do this by looking at your income and expenses.
Once this is established, we can then work out an affordable repayment plan for you to pay all your debts.
This is possible because we negotiate with your creditors on your behalf to reduce the interest rate on your loans. And, get this, doing this means that you could end up saving on your total debt amount in the long-run.
When you go under debt counselling, you also legally protect your assets like your home and your car from being repossessed. Creditors can no longer harass you and your home and car are protected.
Want to see if you qualify for debt counselling? Fill out this quick contact form and we'll give you a call very soon!
Why should you consider Meerkat for debt counselling?
We've already helped thousands of South Africans get out debt.
We've been voted as one of The Top 10 Large Debt Counsellors in South Africa!
We don't just say we care about you, our clients say that too!
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Who is Meerkat?
Meerkat is a financial wellness company that wants to help South African consumers do MORE with their money. We can help with debt repayment negotiations, provide affordable insurance and help you kickstart an emergency fund.
Fill in the contact form on our website to receive a free callback from the Meerkat team today.