In a bid to tackle the affordable housing challenge, FNB is actively collaborating with various stakeholders to create more opportunities for first-time buyers to own their dream homes.
Consequently, there has been a significant increase in the number of new FNB home loans generated through employer-backed partnerships over the past two years.
Mpho Ramatong, FNB Home Finance Division Channel Head: Housing Schemes, says these important partnerships, commonly known as ‘Housing Schemes’ are aimed at making homeownership a reality for more consumers in South Africa through subsidies and other benefits such as special terms on loans and rental assistance programmes.
“Employer-backed partnerships have created an environment where corporates and lenders can work together to reach more consumers and provide them with sustainable access to homes. As a result, our current business model and solutions enable us to offer first-time home buyers, including those who would not have qualified under normal circumstances, 100% bonds with no deposit required,” adds Ramatong.
Furthermore, the agreements offer flexibility as they can be adapted for a specific organisation’s needs, which creates more room for innovative solutions that aren’t constrained by traditional lending models which have many limitations, says Ramatong.
First-time buyers who earn a household income between R3 501 and R15 000 per month also qualify for the Finance Linked Individual Subsidy Programme (FLISP) from the government, which offers qualifying consumers subsidies ranging between R20 000 to R87 000 once off, provided that they haven’t benefitted from a government subsidy before.
In addition to these benefits, FNB further offers first-time homeowners’ compulsory education on all aspects of homeownership.
FNB’s homeowners programme is offered in four convenient formats, namely:
1. 60% eLearning is completed through online training.
2. 35% of the training consist of a self-study pack (DVD, booklet and paper assessment).
3. 1% is completed through classroom training. This used to be the dominant form of training but has reduced since the implementation of eLearning.
4. 4% of the training covers all aspects of the home loan. including:
- Planning and what to expect in your home. This includes a quick introduction in rates and utility bills, maintenance and contingency planning, etc.
- The loan agreement.
- Interest rates - fixed versus variable and related consideration.
- What happens in the event of default.
“Given the massive housing backlog in the country, it has never been more important for various stakeholders to work together to identify sustainable solutions to provide affordable quality housing to South African citizens,” says Ramatong.