Great news for borrowers this week is a one percentage point cut in home loan and overdraft rates charged by most banks to 19 percent.
It's the fourth cut this year, but borrowers are still paying more than the 18 percent of March last year, before rates shot to 24 percent. The latest cut puts an extra R116 in your pocket, if you have a R150 000 loan over 20 years at 19 percent.
The new rate kicks in on April 26 for Standard Bank customers from April 12 for Absa clients.
At First National Bank, existing customer loans will be adjusted downwards from May 2, but new customers will get the reduced rate immediately.
Interest rates for existing home loans at Nedbank, Permanent Bank and People's Bank are effective from April 19.
NBS and Boland PKS home loan borrowers will enjoy the new rate from May.
Mercantile Bank dropped its home loan rate from 19 percent to 18 percent from April 12 for new loans and from April 19 on existing loans. Investec Bank will cut its home loan rate by one percent from April 29.
HOW TO CALCULATE YOUR MONTHLY BOND REPAYMENT INCREASE
Step 1: Divide the outstanding capital balance on your bond by R1 000 to get what is called your capital factor.
Example: R150 000/R1 000 = 150
Step 2: To calculate the new interest rate payable, subtract 1% from existing rate.
Example: 20% - 1% = 19%
Step 3: Multiply your capital factor by the appropriate figure in the table below (using the interest rate you calculated in Step 2) and the remaining life of your bond to calculate your extra monthly payment.
Example: 150 x 0,7696 (20 year bond) = R115,44
REMAINING TERM OF BOND19%18,5%18%
0 years0,63870,64380,6487
15 years0,71420,71940,7246
20 years0,76510,76960,7737
25 years0,79630,79950,8025
30 years0,81410,81610,8160