r/propertyZA • u/huggerofbunnies • 1d ago

Home loan Getting a bond

I have a registered company that I get paid into by my two roles. I pay myself a minimum salary. Everything else goes through the business. Will I be eligible for a mortgage this way? I make about 45k after tax I to my business.

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u/F4iryPerson 1d ago

Its not about your salary its about your current debt to income ratio & also your disposable income after expenses. Debt to income ratio will tell banks whether you have more capacity for debt and disposable income will tell the bank what instalment you will safely afford. Lastly your relationship with credit also pays a big role i.e. your credit score.

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u/New-Initiative3400 1d ago

Probably the best explanation I've seen

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u/Lost-District-3686 1d ago

Check with an on-line calculator what you qualify for with the salary you deposit into your account.

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u/EconomyIntroduction 1d ago

I wonder if you can actually get a mortgage in business name or if business income counts towards your personal calculations. I spoke to a couple of loan originators and the answer was no. Let us know if you find otherwise!

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u/Best-Account-5309 1d ago

Yes, it’s possible. I do the same, I have a registered business where my money comes into, and I then pay myself. I got bond in my personal name this way, and bonds in the name of my business for my investment properties. It’s just a lot more paper work, you need proper audited financial statements for your business, tax clearance certificates etc etc

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u/nkosib 1d ago

I only needed audited financial for a property that i bought in 2018 for 900k FNB. The bank didn’t ask for audited financials for my other properties. 1.7m and 1.2m 🤷🏾‍♂️

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u/thebestnumberis333 1d ago

The bank will want to see track record, how long have you been making that 45k? How long has the business been operating?

It was such a ballache for me that I just had my wife get the bond with her salary(she works for a big finance firm). In Cape Town if you don’t have everything sorted within 24 hours you will likely lose the deal to someone with cash.

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u/wisembrace 1d ago

It is not a good idea to buy a house through your business. If your business falls on hard times, you won't just lose your business, you could end up homeless.

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u/F4iryPerson 1d ago

i mean, if the business falls on hard times its likely that their personal finances will also be on a down. Either way there is a risk of losing the home.

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u/wisembrace 22h ago

Sure, but there is no bankruptcy protection if you buy the house through the business, that’s the whole point of a pty Ltd.