The prime interest rate in South Africa has fallen from 10.25% in May last year to 7.25% today. That makes it the lowest home loan interest rate since 1964! For you it could mean a great opportunity to check out what you can afford...
With rates so low, the monthly repayment of your home loan has become more affordable, falling from R7 362 per month on a 20-year home loan of R750 000 to only R5 940 per month. That is a massive saving of R1 422 every month that will result in a saving in total interest payments of R341 280 when calculated over the 20 year period.
Similarly the total household income before deductions required to qualify for a home loan of R750 000 is now down from R24 550 to around R19 800. And for a home loan of R650 000 you will now need a salary of only R17 150 - that is if you qualify for the prime interest rate of 7.25%
