Don’t use your access bond as an ATM


Most homeowners have a bond on their property and when financial disaster strikes, it’s great to have funds available through your access bond. Unfortunately, many residential property owners get carried away and end up borrowing tens or even hundreds of thousands of Rand against the value of their homes for nice-to-haves.

In this article, we’ll give you some solid reasons why not to use your access bond as an ATM - and help you break the habit if you already do.

How does an access bond work, anyway?

In case you’re wondering what the fuss over access bonds is all about, here’s how they work.

  • When you buy a home with a bond, the total amount you borrowed to pay for the property (called the capital) will need to be paid back over a period of time. This is usually 20 or 30 years.
  • Every month, when you make your bond payment, the capital you owe goes down by a few hundred or thousand Rand (depending on your repayment amount).
  • An access bond lets you borrow back some of the money you’ve paid back, giving you access to cash when you need it.

Why can’t I extend my bond? I paid the money in, after all.

One of the biggest reasons not to use your access bond as an ATM is that it pushes up your monthly bond repayments, and possibly even the interest rate on your bond - that’s because you now have fewer months and years to repay a bigger bond.

The other important reason has to do with the consequences of defaulting on your bond payments.

  • While not paying your credit card or personal loan on time could result in credit blacklisting, not paying your bond could result in you losing your home.
  • That’s a very good reason to pay off your bond as quickly as possible - and not use your access bond unless it’s a real emergency.

Only a seriously disciplined borrower who has the means to meet the new monthly payments timeously should ever consider using their home as security against other debt.


If you’re looking for the ideal Cape Town home at a price that makes for affordable bond payments, we’re here to help. Contact the Cape Realty team today!

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