NEW CREDIT ACT - WHAT IS IT ALL ABOUT?

The New Credit Act came into effect on 1 June 2007. The aim of the Act is to protect the customer against unscrupulous lending. The two key words are ASSESSMENT and UNDERSTANDING. When you as a customer apply for credit you need to prove that you can repay the credit by completing an Income & Expenditure form and that you understand your obligation by signing a Declaration. For more details regarding the Act refer to the FNB website www.fnb.co.za.
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OWN MORE OF THE PLANET...BUY PROPERTY!!

Driving through Nelspruit and White River reassures me that the property market in our area is alive and well. Developments are happening on just about every corner. Development Finance is being invested in Mpumalanga and the economic growth in this area is astronomical. I am concerned however about the lack of developments catering for our R450 000 to R750 000 market which is an income group of R15000 to R25000. So many buyers in this income group preapprove for bond finance but there is little or no stock in the market to accomodate them. If you have felt this frustration chat to us ....

NEW CREDIT ACT - HOW DOES IT AFFECT US?

With the implementation of the New Credit Act there is total financial transparency between the banks. Clients who apply for credit are required to complete an Income & Expenditure Form to prove that they can manage the debt and a Declaration Form to stipulate that they understand the nature of the debt and accept the liability for repaying the debt. No longer will we be bombarded with credit options that we cannot afford to repay but that are lavished upon us so "freely".

NEW CREDIT ACT - DEBT COUNSELLING

Clients who are unable to meet their financial commitments may apply to a registered debt counselor for a proposed resolution. If a debt counselor finds that you are over indebted a proposal can be made to your credit providers, should they disagree with the proposal, the matter may be heard by the magistrate's court who may restructure your debt repayments to make them more manageable.
A list of registered debt counselors is available from the National Credit Regulator's office on 0860 627 627 or at www.ncr.org.za.
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THE NEW CREDIT ACT OVERSWING

With all new systems that are implemented finding the balance takes time. There has been a dramatic drop in the amount of homeloans approved by the various banks since the implementation of the New Credit Act on 1 June 2007, this has affected Buyers, Sellers, Estate Agents, Mortgage Brokers, Attorneys, SARS and Banks financially. Buyers are not able to get their bonds approved as easily, Sellers are sitting with properties on the market for longer because of the bonds not being approved. Valuators have considerably dropped their valuations of properties therefore Sellers are not getting the prices they have bargained on. Estate Agents and Mortgage Brokers are loosing their commissions because of the amount of sales that are falling through, Attorneys are not receiving the volumes of transactions that they used to, SARS are not getting the Transfer Duty amounts they used to and the Banks are not writing the volumes of bonds they used to. Doesn't sound good does it? In spite of it all, property is still a good investment and we need to ride this one a bit until the dust settles and everyone knows what they are doing and where they stand financially. Byt Vas!!
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