The National Credit Act and how it affects your home loan finance.

By now all of us has heard about the National Credit Act (NCA), which came into affect on June 2007. We will now explain what the National Credit Act is and how it affects the public.

The National Credit Act was brought in to make sure that everyone that applies for a home loan does not exceed their credit limit. The reason for this is to stop the public from making to much debt to their name. Previously, the bond repayments were not to exceed 30% of their proved income. Now, the NCA makes all the banks legally responsible for doing a full credit check on the applicant before giving him/her a home loan. When clients apply for a mortgage they will be asked to declare their full income as well as their expenses.

The banks will have to ensure that the client has declared all of his income to the banks. This includes retail accounts, credit cards, car repayments or any other debt you may have to your name. Even if you are still paying on your first bond, you will have to declare it as well.

If you want to apply for a home loan and obtain your home loan finance then you will have to make sure that your finances are in check, as this will make it quicker for the bans to make an assessment.

If you need have any questions or need to speak to a bond consultant you can call us on