The Various FNB Mortgages

There have been a lot of changes in the South African housing market over the last decade. From the boom that began in 1998 to the height of South African homeownership in 2003 – at seventy-three percent – the market now gives every indication that it has reached a plateau. The government has responded by enacting policies designed to heighten the demand for and availability of housing to consumers at every end of the income spectrum, in an attempt to increase the number of South African homeowners.



South Africa’s First National Bank – more commonly referred to as FNB – now offers a range of options when it comes to FNB home loans, with an eye toward making them available to everyone. FNB will assist you and offer their expertise to ensure that your home buying experience is as simple as possible. Here are some of the various mortgage options that may be perfect for you.

The Traditional

Used only for the purpose of buying houses the owner intends to occupy, the Traditional home loan involves obtaining a loan from a bank. Only individuals and couples need apply, though private companies, close corporations, and various trusts are also allowed to obtain these loans. There is a monthly earning requirement of R15K and certain credit restrictions as well.

The Foreign Choice

There are even options for expatriated South Africans and foreigners who have decided to purchase homes in the country. There is the requirement that you pay half of the property value upfront, however, since the financing entity will only provide funds for half the loan value.

The Smart Bond

For low income South African home buyers, approved applications for a Smart Bond help the borrower avoid the deposit and obtain complete financing for the purchase. This is one of those loan options designed to make homes as affordable as possible so that as many people as possible can obtain their own house. With Smart Bond, you can receive assistance in getting your home loan, developing a personal portfolio of investments, and finally live the life you have always wanted.

Financing for Islam

To meet the particular needs of Shari’ah law – the Islamic code of conduct that forbids interest, among other things - FB has developed the Islamic Finance option. This type of loan, administered by the FNB, involves the use of a certain contract type. The contract itself acts as a mortgage agent and uses fixed rates to buy a house for you. This enables you to avoid direct involvement in any interest-charging loan since you pay through the agency agreement rather than submitting directly to an interest loan.

The best part of this loan option is that everything is set in stone for the duration of the mortgage. That enables you to avoid rising interest costs. The major disadvantages involve the fact that you cannot obtain additional financing, building loans, or readvances, since these are all inconsistent with Islamic legal requirements.

Obviously, the tremendous numbers of loan types offered by the FNB ensure that almost anyone can find a home loan fitting their individual needs. Once you do, you can then determine your budget ability, find the right home, and get started on your loan application.