Buying a home is a long-term financial commitment - but there are ways to make your home more affordable, a deposit is one way.

 

When you pay a deposit towards the purchase of a property, your loan amount and your monthly repayments will be less. And, a deposit may even get you a better interest rate on your home loan.

How can a deposit save me money?

Take a look at the example below:

(please note: the amounts shown below are simply examples of a potential scenario):

  With a deposit Without a deposit
Purchase price of property R 550 000.00 R 550 000.00
Deposit R 55 000.00 R 0.00
Deposit percentage (of home cost) 10% 0%
Home Loan amount R 495 000.00 R550 000.00
Term (in months) 240 240
Interest rate 9,65% 9,95%
Monthly repayment R 4 760.47 R 5 289.41
Savings (per month) R 528.94  
Savings (over 240 months) R 150 424.44  
  • In the above example, with a deposit of R55 000.00 you could potentially save R150 424.44 on your loan repayments over 240 months due to a lower interest rate and a lower loan amount.
  •  In the above example, with a deposit of R55 000.00 you could potentially pay R528.94 less per month due to a lower interest rate and a lower loan amount.

Why you should consider a deposit

Paying a deposit could make your repayments more affordable and could get you a lower interest rate, compared to not paying a deposit. Smart financial planning is the best way to buy yourself a home and paying a deposit is almost always the smart thing to do!

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