How Banks are Holding It In With Personal Loans - Personal Loans ...

It is no secret that estate agents and developers are growing increasingly irritated with banks? seemingly irrational unwillingness to lend to home-buyers. Furthermore banks are blamed for putting a dampener on housing price growth by valuing homes really low ? and in some instances at least 10 to 15 % less than market value. When looking for personal loans or finance to purchase a home, getting finance from the banks is becoming increasingly problematic.

??? ?These accusations come in what has been the most drawn-out downturn ever experienced by the SA property market.
??? ?Although there are bits and pieces of increased activity the total number of house sales is still down as a direct result of banks being reluctant to lend money.
??? ?That means that at least R71 billion has been wiped out in residential sales in the past couple of years.
??? ?Supply still remains high while demand is not quite buoyant.
??? ?It is not unusual that a house could take at least 12 months or more to sell.
??? ?This is particularly the case with houses that cost more than R3 million.
??? ?At the end of the day, closing sales is what it is all about.
??? ?Banks are loath to lend to the self-employed or new business owners, irrespective of how strong their financial track records or balance sheets might prove to be.
??? ?The market is no longer defined by normal supply and demand ? it is understandable that banks are still sitting with huge amounts of nonperforming loans, but it appears that the local institutions are being overly influenced by trends in the far more volatile housing markets in Europe and the US.

South Africa?s big banks are expected to further reduce their bad debt levels before they feel inclined to increase lending. Although impairments on bad loans are being reduced radically they still make up 5, 8% of the average loans granted.

If you are looking for personal loans and you are a small business owner or entrepreneur, proof of regular and consistent cash flow is key.

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Source: http://bassettoinvestments.co.za/blog/2012/10/19/how-banks-are-holding-it-in-with-personal-loans/?utm_source=rss&utm_medium=rss&utm_campaign=how-banks-are-holding-it-in-with-personal-loans

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