THE FACTS

THATO Mokwena from Vanderbijlpark, south of Joburg, applied for a bond in 2017 from Housing Investment Partners.

He said when he was first granted the bond, the monthly repayment was R5 600, but now he’s paying R6 017 a month.

He said while the repo rate is going down, his bond repayment is going up.

WHAT I DID

I asked Housing Investment Partners for clarity.

SOLUTION

Loveday Chamisa, head of credit and risk at Housing Investment Partners, said the home loan initially offers lower instalments than a traditional home loan with a similar interest rate.

However, the instalment increases annually at the same percentage as the salary of the borrower or the Consumer Price Index, plus 1% to enable the home loan to be paid off in 20 years.

Changes in instalment are linked to changes in salary and not the repo rate, as is the case with the traditional home loan.