Why some people get their home loan approved and others don’t
South Africa’s property market has been picking up pace again. Lower interest rates and gradual improvements in household finances are making it easier for qualified buyers to secure finance. The recent rate cut brought the repo rate down to 6.75 percent and prime to 10.25 percent. That shift has boosted affordability for first time buyers and eased pressure on existing homeowners.
Rate cuts that add up to 1.5 percentage points since late 2024 have helped reduce monthly bond instalments. A drop of even a few hundred rand can make a noticeable difference in a household budget. It also means banks can approve larger loans for the same income. If salaries increase next year, affordability will improve further. Buyers who prepare early can take advantage of this window.
For those planning to buy, financial discipline remains the strongest signal you can send to a bank. A clean record, predictable income, and low debt show that you can manage long term commitments. Below are practical steps that strengthen a home loan application.
Strengthen your credit profile
Banks review your entire credit history, not just your score. They look for signs of responsible behaviour.
Keep your profile clean – Make sure your accounts are up to date. Fix old listings or disputes. Avoid opening new credit accounts unless necessary.
Use credit conservatively – Keep your utilisation low. Maxed out credit cards or revolving facilities increase your risk level.
Reduce your existing debt
Your debt to income ratio matters. The lower it is, the more confident a bank feels about your affordability.
Pay down high interest loans first – Focus on credit cards, overdrafts, and personal loans. These weaken your application the most.
Avoid taking on new commitments – Car finance and store accounts reduce the amount you can borrow. Keep your expenses stable while preparing to apply.
Show consistent income and stability
Employment history is a major factor in lending decisions.
Demonstrate steady earnings – Banks want to see predictable income. Keep payslips, employer letters, tax documents, and financial records in order.
Maintain stable employment – Frequent job changes, large income fluctuations, or long gaps can make lenders cautious.
Build up a meaningful deposit
A deposit reduces the loan amount and shows commitment.
Aim for at least 10 percent – A larger deposit usually improves approval odds and can unlock better interest rates.
Keep deposit funds separate – Store your savings in an account that is easy to verify. Banks will request proof of source and balance.
Compare your options before applying
Not all lenders assess risk the same way. Shopping around helps you find the institution most likely to approve your application.
Try multiple banks or a bond originator – They can compare offers and explain why certain banks may be more favourable based on your profile.
Review interest rate options – Small differences in rates or fees can change long term affordability.
Prepare your documents early
Organised applicants move through the system faster and with fewer delays.
Collect the basics – Banks will usually ask for three months of bank statements, payslips, tax documents, and proof of address.
Keep records clean – Avoid unexplained deposits or withdrawals during the assessment period. Lenders review your statements line by line.
Why timing matters right now
Lower inflation, better job numbers, and softer lending conditions have created one of the friendliest environments for buyers in recent years. First time buyers are benefitting the most, but existing owners may also find it easier to trade up.
If you want to explore homes within your budget, you can start browsing current listings on ImmoAfrica. Properties are updated daily, which makes it easier to track pricing and compare options.
Smart preparation puts you in a stronger position. Manage your credit, reduce debt, save a healthy deposit, and keep your records clean. These steps increase your odds of approval and help you secure finance at a competitive rate. With conditions improving, buyers who organise themselves now stand to benefit the most.