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Nedbank Home Loans relaxes Lending criteria
30 September 2009
Nedbank announced today that it is relaxing its deposit requirements for residential mortgage loans. For the past year or so the bank has required deposits of 10 – 20% for new home loans, driven mainly by expected declines in house prices. This deposit requirement has now been reduced to 0 – 10%, depending on the risk profile of the client.
Clive van Horen, Head of Secured Lending says, 'Nedbank Home Loans has remained open for business throughout the turbulence of the past year, so this is not a dramatic change for us. Nonetheless, we believe that the outlook for house prices has improved enough for us to relax our deposit requirements. For low-risk clients – both existing Nedbank clients and clients who are new to the bank – we will lend up to 100% of the purchase price of their new homes. In general, though, we continue to believe that putting down a 5 – 10% deposit is good practice for both the client and the bank, and therefore we will continue to encourage clients to do likewise'.
On the question of whether Nedbank is differentiating between clients who apply for home loans through mortgage originators as opposed to the bank's branches, van Horen adds, 'some of our competitors will offer clients a different loan amount for the same transaction depending on whether they apply through a branch or originator. We have chosen not to discriminate in this way, because while we encourage clients to visit our branches to apply for home loans, we also believe that mortgage originators are important partners for Nedbank in introducing clients who might otherwise not have visited our branches. The interests of originators and the bank are much more closely aligned since commissions and other incentives were changed in the past year, so we are happy for clients to choose the channels that are most convenient for them. What matters more to us than the channel through which a home loan is originated, is the risk of the client and the transaction itself'.
ENDS| Issued by Nedbank Group Communications: | |
| Contact: | Miyelani Shikwambana Tel: +27 11 295 5376 Fax: 011 294 5376 Cell: 082 908 7260 Email: miyelanis@nedbank.co.za |
| This page was updated on 6 October, 2009 6 October, 2009 |  Return to top |
