Essential documents for a successful bond application

Buying a home is an exciting time, but for most South Africans, it also comes with the challenge of securing a bond, and one of the biggest stumbling blocks for buyers is often paperwork. While it may feel like this is the least glamorous part of the journey, being well-prepared with the right documentation can make or break your application.

Lenders are meticulous when assessing bond applications, and missing or incomplete paperwork often leads to delays or worse, rejection.

When you apply for a bond, the bank’s main concern is your ability to repay the loan. To assess this, they need a clear picture of your financial standing, credit history, and income stability, and the documents that you submit act as proof, giving lenders the confidence that you are a reliable borrower.

Delays often happen when applicants submit incomplete paperwork, leading to back-and-forth requests for additional information and, in competitive property markets, where multiple buyers may be interested in the same home, such delays could cost you the deal. Being prepared from the start speeds up approval and gives you an edge.

To smooth the process and improve your chances of approval, it’s essential to gather all your required documents before you even start applying.

Not only does this save time, but it also shows banks that you’re organised, financially stable, and serious about purchasing a property. Having your documents ready before applying for a bond isn’t just good preparation - it’s a crucial step in giving yourself the best possible chance of securing financing smoothly and quickly.

Documents you’ll need to apply for a bond

Although requirements may vary slightly between banks, most South African lenders will request the following:

1. Proof of Identity

• A certified copy of your South African ID or passport (for foreign nationals).

• For married couples, both spouses’ documents will be required.

Proof of Income

• Salaried individuals: Recent payslips (usually the last three months) for a fixed income or six months for a variable income.
• Self-employed individuals: Up-to-date financial statements (profit and loss, balance sheets) signed off by an accountant, plus six months’ bank statements.

Bank Statements

• At least three months of personal bank statements, showing salary deposits and expenses, and the last three months' statements of an existing bond.

• Self-employed individuals need to submit six months of personal and business bank statements.

Proof of Residence

• A utility bill, rates account, or lease agreement confirming your current address.

Tax documentation

• Your latest IRP5 or tax return.

• Self-employed applicants may need Sars tax clearance certificates.

Details of the property

• An offer to purchase (OTP) signed by both buyer and seller, and a valuation report.

• If you are applying for pre-approval (before finding a home), you won’t need this yet.

Other supporting documents

• Marriage certificate or antenuptial contract (if applicable).
• Divorce decree or settlement agreement (if relevant).
• Proof of additional income, such as rental agreements or investment statements.

• Self-employed are generally also required to submit: a personal statement of assets and liabilities, a personal statement of income and expenses, ITA34 (SARS summary of tax year), last 3 years business financials (audited and signed), auditor’s letter of income, auditor’s letter to confirm shareholding percentage, a cash-flow forecast for the ensuing 12 months and management accounts.

One of the smartest steps home buyers can take before applying for a bond is to get bond pre-approval. This is when a bank or bond originator assesses your financial situation upfront and confirms the loan amount that you’re likely to qualify for.

Advantages of pre-approval:

1. Clear Budgeting: Pre-approval tells you exactly what price range you can afford, preventing you from wasting time on homes outside your financial reach.
2. Stronger Negotiating Power: Sellers and estate agents take you more seriously when you already have pre-approval. It shows you’re a committed buyer who can secure financing quickly.
3. Faster Final Approval: Since the bank already has your documents on record, the final bond approval process is much quicker once you’ve made an offer.
4. Early Identification of Issues: Pre-approval highlights any problems with your credit score or documents upfront, giving you time to fix them before making a formal application.

Applying for a home loan can feel overwhelming, especially for buyers navigating the process for the first time.

Between gathering paperwork, dealing with banks, and understanding what lenders are really looking for, buyers often end up stressed or face unnecessary delays, but the good news is that with the right preparation and a few practical strategies, securing a bond doesn’t have to be complicated.

By knowing what to expect - and avoiding the most common mistakes - you can make your application smoother, faster, and far more likely to succeed.

Here are tips for a seamless application process:

1. Stay Organised: Keep all your documents together in both hard copy and digital format. This makes it easier to share with banks or bond originators.
2. Check Your Credit Score: Request a free annual credit report from a credit bureau. A good score improves your chances of approval and may qualify you for better interest rates.
3. Avoid New Debt: Try not to take on new loans or large expenses while applying for a bond. Lenders scrutinise your debt-to-income ratio closely.
4. Use a Bond Originator: Services like ooba can apply to multiple banks on your behalf, increasing your chances of approval and helping you secure the best interest rate.

Whilst applying for a bond is never going to be the most fun you’ll ever have, it also doesn’t have to be overwhelming. The key is preparation. Having all your documents ready before approaching the bank demonstrates responsibility, reduces delays, and puts you in the best possible position to secure approval. Pair this with pre-approval, and you’ll not only shop for homes with confidence but also enjoy a faster, smoother buying journey.

* Maritz is the co-principal for Lew Geffen Sotheby’s International Realty in Cape Town’s Southern Suburbs and False Bay.

PERSONAL FINANCE