Apply for an Absa Bank Mortgage Loan, reviewed by our experts. As of 17.02.2025, you have access to loan options. Increase your chances of approval by completing an online application and getting a free credit rating check.
Update 19.11.2024
Absa Bank provides a wide range of home loan options tailored to diverse needs, including first-time buyers, property investors, and those seeking to refinance or build. With up to 105% financing, competitive interest rates, and repayment terms of up to 30 years, Absa ensures accessibility and flexibility. Specialized products like the MyHome Loan for lower-income earners and the Eco Home Loan for sustainable housing offer unique benefits, while loyalty rewards and fixed or variable interest rate choices add value. Clients also gain access to resources like the MyHomeowner Journey educational program and online tracking tools, ensuring a seamless and informed home loan experience.
Types of Absa Bank Mortgages
Absa Home Loan. Offers financing of up to 100% of the property value with flexible repayment terms ranging from 5 to 30 years. Customers can choose between fixed or variable interest rates. There is also the option to change the repayment term at any time without additional costs. Home loans are managed conveniently online or through the Absa Banking App. Additional benefits include access to comprehensive insurance and financial planning services. Specific interest rates are determined based on individual creditworthiness and affordability assessments.
MyHome Loan. Designed for individuals or households with a single or combined gross income of up to R32,000 per month. This loan provides up to 105% financing to cover additional costs such as attorney fees. Borrowers benefit from a 50% discount on bond registration fees, free borrower education, and the option to access the FLISP government housing subsidy. Loan repayment terms can extend up to 30 years, and applicants must meet specific income and affordability criteria. This product also includes free insurance consultations and financial planning advice.
Eco Home Loan. Tailored for environmentally conscious buyers purchasing properties in Absa-approved EDGE-certified developments. Features a -0.25% concession on variable interest rates and up to 3% (maximum R55,000) of the loan amount as a rebate. Eligibility requires the property to be purchased directly from an approved developer. This loan is not available for resale properties, non-Absa-approved developments, or further advances. Specific repayment terms and rates depend on the customer’s financial profile.
Loyalty Home Loan. Geared towards existing Absa customers who are selling their current home and purchasing another through Absa. Provides up to R25,000 as a once-off cashback (0.5% of the new loan amount), a 50% discount on bond registration fees, and waiver of early termination charges on the existing home loan. Customers must link their new home loan repayment to an Absa Gold Value Bundle or Premium Cheque Account. Fixed interest rates are available only after bond registration.
Private Banking Home Loan. Offers tailored mortgage solutions for high-net-worth clients earning a gross monthly income of at least R62,500. Features include a dedicated private banker, the ability to link multiple loan accounts under one credit facility, flexible repayment structures, and the option to negotiate interest rates. Clients benefit from exclusive Private Banking Suite access and free eStatements. Specific interest rates and repayment terms are customized to individual financial circumstances.
First-Time Home Buyer Loan. Aimed at individuals purchasing their first property, offering up to 106% financing to cover purchase-related costs. Borrowers gain access to financial planning services, insurance products, and a free borrower education program. Additional perks include a 50% discount on bond registration fees and optional fixed interest rates post-registration. Eligibility requires proof of income and meeting affordability assessments.
Building Loan. Provides financing for construction projects, covering costs in phased payments upon completion of each building stage. The loan requires specific documentation, including an NHBRC registration certificate for the builder, approved building plans, and a detailed bill of quantities. Loan terms and interest rates are tailored to individual circumstances. Additional benefits include the ability to manage construction financing securely through Absa platforms.
Buy-to-Let Loan. Supports property investors purchasing rental properties. Existing and future rental income can be included in affordability assessments, and the loan offers discounted access to services from TPN and Trafalgar. Investors benefit from Absa Law for You legal services (up to R200,000 annually) and personalized financial planning support. Interest rate concessions are available for qualifying accounts. Repayment terms vary based on the investor’s profile.
Key Features
Flexible Repayment Terms. Absa home loans offer repayment periods of up to 30 years, allowing clients to select a term that best suits their financial capacity and long-term plans. Clients can adjust repayment terms at no additional cost.
Access to High Loan-to-Value Ratios. Clients can qualify for up to 105% financing with certain products, such as the MyHome Loan and First-Time Home Buyer options, which cover additional costs like bond registration and transfer fees.
Variable or Fixed Interest Rate Options. Clients can choose between variable interest rates tied to the prime lending rate or fixed rates that lock in payments for a set period, ensuring flexibility to manage financial risks.
Exclusive Benefits for Repeat Clients. With the Loyalty Home Loan, repeat buyers can receive up to R25,000 in Absa Rewards cashback, a 50% discount on bond registration fees, and a waiver of early termination charges on the settlement of their current loan.
Eco-Friendly Incentives. The Eco Home Loan rewards environmentally conscious buyers with a -0.25% interest rate concession and a rebate of up to 3% (capped at R55,000) for properties in Absa-approved green developments.
Comprehensive Insurance Options. Borrowers can secure their property with Homeowner’s Comprehensive Insurance, Home Loan Protector policies for death or disability, and other tailored products designed to provide peace of mind.
Pros and Cons
Pros
High Financing Limits. Absa provides home loans that can exceed the property’s value for first-time buyers and eligible MyHome clients, allowing them to cover additional expenses such as registration fees and transfer duties, making homeownership more attainable.
Innovative Application Support. Clients benefit from tools like the MyHomeowner Journey platform, which provides free education on purchasing and owning a home, and online tracking for loan applications, ensuring transparency and informed decision-making.
Loyalty and Concession Benefits. Absa provides tangible financial incentives to existing customers, such as interest rate concessions for bundled account holders and loyalty rewards for repeat buyers, creating added value for long-term clients.
Cons
Income Thresholds for Premium Loans. Certain high-tier products, such as the Private Banking Home Loan, require a high minimum monthly income, limiting access to these exclusive features for middle-income clients.
Limited Access for Non-Eco Developments. The Eco Home Loan rebates and interest rate concessions are only available for properties within Absa-approved EDGE Certified developments, excluding resale or non-certified properties from this benefit.
Bond Registration Fees Apply to Standard Loans. While some products offer discounted or waived bond registration fees, clients using standard loans without qualifying for these concessions face additional upfront costs, increasing the overall financial burden.
How to Get an Absa Bank Mortgage?
Evaluate Your Financial Position. Begin by assessing your income, expenses, and credit history. Use Absa’s online affordability calculator to determine your borrowing capacity and ensure you meet the minimum income requirements for your desired home loan product.
Choose the Right Home Loan. Review Absa’s range of home loan options, including the MyHome Loan, Eco Home Loan, Loyalty Home Loan, and Private Banking Home Loan. Each product has unique features such as up to 105% financing for MyHome or interest rate concessions for Eco Home Loans.
Prepare Required Documentation. Gather the necessary documents, including a valid South African ID, proof of residence (not older than three months), the latest payslip, three months' bank statements showing salary deposits, and a signed Offer to Purchase with seller and property details.
Complete the Application Online. Visit the Absa website or use the Absa Banking App to start your application. Submit personal, employment, and financial details along with the required documents. Existing Absa customers can log in to pre-fill information, streamlining the process.
Visit a Branch. Alternatively, locate the nearest Absa branch using the "Locate Us" feature on the website or app. Bring the required documents and consult with a banking professional for personalized assistance in completing your application.
Undergo Credit Assessment. Absa will conduct a credit check and affordability assessment. This process evaluates your eligibility based on your income, debt-to-income ratio, and credit score. Positive results lead to the approval phase.
Property Valuation. For approved applications, Absa arranges a property valuation to determine its market value. This step ensures the loan amount aligns with the property’s worth.
Receive and Accept Offer. Once approved, Absa issues a loan offer detailing the terms, interest rates, and fees. Carefully review the terms, sign the Letter of Acceptance, and return it to finalize the agreement.
Conveyancing and Bond Registration. Absa’s appointed attorneys will draft and manage the bond registration process. Attend the conveyancer’s office to sign the required documents. The process takes about 8-12 weeks to completion at the Deeds Office.
Access Funds and Begin Repayment. Upon successful registration, the loan funds are disbursed, and you can access your new home. Repayments will begin as per the agreed-upon schedule.
Requirements and Conditions
Requirements
Residency. Applicants must be South African citizens or permanent residents with a valid South African ID or Smart ID card. For joint applications, all participants must meet this requirement.
Income Verification. Permanently employed applicants must provide the latest three months’ payslips and bank statements showing income deposits. Self-employed applicants must submit signed financial statements for the last two years, six months of bank statements, and proof of registration for their business.
Offer to Purchase. A signed Offer to Purchase agreement is mandatory, including seller and purchaser details, property description, purchase price, and signatures of all parties involved.
Age. Applicants must be at least 18 years old and legally competent to enter into a binding contract.
Proof of Address. Recent proof of residence, not older than three months, is required as part of the application.
Creditworthiness. A satisfactory credit score and debt-to-income ratio are assessed to determine eligibility. Absa conducts credit checks as part of the process.
Additional Documents for MyHome Loan. First-time buyers must complete a free borrower education program and provide documents proving eligibility for the FLISP subsidy if applicable.
Conditions
Loan Amounts. Absa offers home loans starting from R50,000, with a maximum amount based on affordability and property value. MyHome Loans provide up to 105% financing for eligible buyers.
Interest Rates. Applicants can choose between variable and fixed interest rates. The fixed rate is available only after bond registration. Eco Home Loans feature a -0.25% interest rate concession.
Loan Term. The loan term ranges from 5 to 30 years, providing flexibility in repayment duration.
Additional Costs. Applicants must cover bond registration and transfer fees, unless eligible for discounts. For instance, MyHome Loan clients receive a 50% discount on bond registration costs.
Early Termination Fees. Clients settling their home loan account early may incur a penalty unless they qualify for a waiver, such as under the Loyalty Home Loan program.
Insurance Requirements. Absa mandates home loan protection insurance covering the outstanding balance in the event of death or disability. Additionally, comprehensive homeowner’s insurance is required to cover the structure.
FLISP Subsidy. For eligible first-time buyers, the Finance Linked Individual Subsidy Programme (FLISP) provides a once-off subsidy ranging from R30,001 to R130,504, depending on income level.
Eco Home Loan Rebate. Clients purchasing properties in Absa-approved EDGE-certified developments qualify for up to 3% of the loan amount (up to R55,000) as a rebate, which is paid into their loan account.
Ways to Receive the Money
Once approved, Absa Bank disburses the mortgage funds directly to the attorney handling the property transfer or the developer in the case of new builds, ensuring secure and appropriate allocation. For building loans, payments are made in stages to the construction company as specific milestones are completed and verified by a quantity surveyor. No cash is transferred to the borrower's account or card, as all funds are managed through authorized legal and financial channels to ensure compliance with South African property and banking regulations.
How to Repay Absa Bank Mortgage?
Automatic Debit Orders. Set up an automatic debit order from your linked Absa bank account to ensure timely and consistent mortgage payments. This option minimizes the risk of missed payments and is mandatory for clients who qualify for interest rate concessions through specific bundled account options.
Online Payments via Internet Banking. Log in to Absa Online Banking, navigate to the "Payments" section, and schedule one-time or recurring payments directly to your mortgage account. This method provides flexibility to adjust payment amounts as needed.
Absa Mobile Banking App. Use the Absa Banking App to make payments conveniently from your mobile device. Select the mortgage account, input the payment amount, and confirm the transaction securely.
In-Person Payments at Branches. Visit an Absa branch to pay your mortgage with cash or a linked debit card. Bank representatives can assist with processing payments or setting up recurring transactions.
Additional Payments. Absa allows lump-sum payments toward the mortgage balance to reduce the principal amount and save on interest costs. Additional payments can be made via online banking, the app, or in person at a branch.
Payment Flexibility. Clients can choose monthly, bi-weekly, or customized payment schedules based on their financial preferences. Adjustments to the payment frequency can be arranged by contacting Absa support or through your mortgage advisor.
Things to Pay Attention to
Interest Rate Options. Review whether a fixed or variable interest rate suits your financial plan. Fixed rates provide stability, while variable rates may offer initial savings but are subject to fluctuations, impacting affordability over time.
Loan-to-Value Ratio (LTV). Understand the percentage of the property value covered by the loan. Absa offers up to 106% LTV for first-time buyers under specific conditions, which can reduce upfront costs but increase the loan amount and interest payable.
Affordability Assessment. Ensure your debt-to-income ratio aligns with Absa’s requirements. Use the bank's affordability calculator to evaluate your financial capacity for repayment, factoring in additional costs such as transfer duties, insurance, and maintenance.
Mortgage Duration. Absa allows repayment terms from 5 to 30 years. While longer terms lower monthly payments, they increase the total interest paid. Consider balancing affordability with total repayment costs by choosing an optimal loan term.
Co-Borrower Implications. If applying with a co-borrower, both parties must meet income and documentation requirements. Ensure that both credit histories are strong, as the weakest profile may affect approval or interest rates.
Additional Costs and Concessions. Be aware of additional fees such as bond registration and attorney costs. For qualified clients, Absa offers up to 50% discounts on bond registration fees and other incentives like interest rate concessions when linked accounts are used for repayments.
Eligibility for Subsidies. If your household income is under R32,000, explore options like MyHome and FLISP subsidies. These programs provide benefits such as reduced costs and access to free borrower education, which can significantly lower your financial burden.
Editorial Opinion
Absa Bank offers diverse mortgage options to suit various financial needs, with flexible terms, competitive interest rates, and innovative programs like MyHome and Eco Home Loans. Its resources and incentives, such as interest rate concessions and borrower education, add significant value. However, high-income requirements for premium products and limited benefits for resale properties may restrict access for some clients. Overall, Absa combines accessibility, sustainability, and financial flexibility, making it a strong choice for homebuyers who meet its criteria.
How does Absa Bank support clients in managing their mortgages effectively?
Absa Bank provides several tools and services to ensure effective mortgage management. These include the MyHomeowner Journey platform, which offers borrower education, and the Absa Banking App for tracking applications, managing payments, and viewing loan statements. Clients can also access financial planning consultations via the Virtual Adviser service and utilize online calculators to estimate affordability and repayment schedules. Personalized advice is available through private bankers for premium clients, ensuring tailored financial solutions.
What are the environmental benefits of the Eco Home Loan, and how can clients maximize them?
The Eco Home Loan incentivizes buyers to choose environmentally sustainable properties by offering a -0.25% interest rate concession and up to 3% of the loan amount (capped at R55,000) as a rebate. To maximize these benefits, clients should focus on purchasing properties within Absa-approved EDGE-certified developments. These homes are designed to reduce energy and water consumption, aligning with both cost savings and environmental responsibility.
Are there any options for clients facing financial difficulties during the mortgage repayment period?
Absa offers flexible repayment options and financial support to clients in financial distress. This includes restructuring loans, adjusting repayment terms, or temporarily reducing payments. For those with Home Loan Protector Insurance, coverage ensures repayments in the event of death, disability, or terminal illness. Clients can consult with their mortgage advisors for tailored assistance based on their financial situation.
What unique benefits does the Buy-to-Let Loan offer property investors?
The Buy-to-Let Loan allows property investors to include existing and potential rental income in their affordability assessments, enabling greater access to financing. Additional benefits include discounted legal and property management services from partners like TPN and Trafalgar and access to Absa Law for You, which provides legal assistance for rental disputes and other matters. Investors can also negotiate interest rate concessions if linked accounts are used for repayments.
How does the FLISP subsidy enhance the affordability of a home for first-time buyers?
The Finance Linked Individual Subsidy Programme (FLISP) provides a one-time lump sum subsidy ranging from R30,001 to R130,504, depending on the buyer’s income. This subsidy is applied as a deposit or to reduce the loan amount, significantly lowering monthly repayments. To qualify, applicants must be first-time homebuyers earning a household income between R3,501 and R22,000 and meet other criteria, such as never having benefited from a housing subsidy before.
