HOW LONG DOES IT TAKE TO APPLY FOR A 2ND BOND / FURTHER LOAN?

Date Added: 12/10/2007
Author/Source: Jessica Linde of BrayCorp Financial Services


Many people require access to funds for a number of reasons, including:

- Renovations
- Holidays
- Purchasing a business
- University fees for their children


Generally speaking, the money you are able to access from your bond is significantly cheaper than, for example, Hire Purchase or Credit Cards. As such, many people apply for a 2nd or even 3rd bond in order to release some of the equity available in their property.

For example, a home owner who owes R250 000 on their bond but whose property has grown in value to R800 000 is able to apply for a further loan (2nd bond) up to a maximum of a further R550 000 with the value in the property as security (provided they are able to afford a bond higher than their existing R250 000).

This process of a 2nd bond or further loan application is both easier and faster than purchasing a new property since no transfer is taking place, there is only a bond registration. A normal property purchase and transfer takes around 3 months while a 2nd bond registration can be completed in 6 – 8 weeks. Approval from the banks is much faster with an answer usually obtained within 3 working days but a great deal of paperwork is required for the attorneys (in conjunction with the deeds office) to register the bond in favour of a particular bank and release the funds to the client.