Bond origination / Mortgage origination / Home loans

Bond origination or mortgage origination or broking (as it is called in many other countries) is a relatively new industry in South Africa. Bond origination really only started to become popular in the early 2000's and really came to it's own during the property boom. During this +- 15 years it has become a major part in the every day lives of estate agents country wide. Bond origination is beneficial to the client (property buyer), the estate agents and the banks.

What is the benefit for the client (property buyer) to work with a bond origination consultant?

The property buying process is a very emotional time for a client to go through. Even more so should the client be a first time home buyer. Many of the terms used between estate agents, attorneys, bond originators and the banks will be very confusing to the client. The hassle to go to each and every bank separately, sitting and waiting in the queues, completing a home loan application form of each bank, compiling all the supporting documentation each bank needs and making sure that the home loan application gets submitted can be a very stressful and time consuming process. Not to even mention all the phone calls, e-mails and waiting to go through in order to get the correct feedback. By working with a bond origination consultant the client will benefit in the following manner:

• Bond origination services are FREE OF CHARGE! They have contracts with the major financial institutions and receive a service fee from the chosen financial institution where the bond has been granted and accepted by the client. We only receive this fee on registration of the bond.
• They hold the client's hand throughout this daunting process, from starting with the bond application until the bond has been registered in the client's name.
• The client completes one application form and collate one set of supporting documentation for the bond origination consultant. The bond origination consultant submits the application electronically to all major financial institutions simultaneously.
• The client will receive regular feedback during the whole process directly from the bond origination consultant.
• The client has one contact to follow up on all applications submitted.
• The client will end up with the most cost effective home loan, at the best possible rate, in the fastest possible time.
• By using a bond origination consultant the success ratio of the application is much higher than going to only your own bank directly.
• Bond origination services save the clients time and money.

What is the benefit to the estate agent to use a bond origination consultant?

At the estate agent is where all the action starts. The estate agent is the main contributor in the whole property value chain, as everyone feeds from them. Each estate agent has their own business partners they use in order to do a transaction and ultimately finalising the sale. The bond originator plays a major role in this value chain and in the lives of estate agents.

• The majority of the bond origination companies have experienced, bank trained, home loan consultants who are able to assist the estate agent in doing more successful sales.
• The estate agent have more control over the home buying process. Feedback during the home loan process is critical for any estate agent. The bond origination consultant will give daily feedback to the estate agent during the bond application process.
• Bond origination consultants are able to do pre-qualifications to make sure that a potential buyer can afford the property he is interested in. It is highly recommended to use a bond origination consultant from the start of the process, once the client is introduced to the estate agent, to make sure that the estate agent does not show properties to clients, which they can't afford.
• The success ratio of an application is much higher using a bond origination consultant.
• Bond originators give the clients more choices. They will present the quotations from the financial institutions to the client to choose the best option.
• And again, the service is free of charge.

What is the benefit to the banks to work with bond originators?

All the banks and financial institutions play a major part in the life of a bond originator. Bond origination companies have contracts with the banks and introduce clients to them in order to have a chance to give the client the home loan they need. Bond originators have access to regional and national management at the banks to discuss possible applications, should there be any challenges. Banks and originators are big business partners and play a critical role in the property industry value chain.

• It is a great channel through which the banks can access new home loan clients onto their books.
• Bond origination plays a valuable part in the property industry by adding value to the bank and the client.
• The knowledge and expertise of a bond origination consultant has become invaluable to the banks.
• The banks are able to process the applications seamlessly as the bond originators establish the client's needs in terms of products available by the specific bank and compiles the relevant application on behalf of the client.
• All of the above leads to greater efficiency and cost saving for everyone.

Bond origination is a valuable part of the home buying and home owning process. The whole value chain, every industry involved in it, benefits from it. 

Source : BA Frank – ba@bondgallery.co.za