Housing Loans

Members of the Fund can apply for housing loans using their retirement savings as collateral. This benefit is designed to assist members in securing a home by leveraging their pension savings.

Here’s an overview of how it works:

• Purchasing an existing property that you or your spouse stays in.
• Building a new home.
• Making improvements or renovations to an existing property.

You cannot get a pension-backed housing loan for an investment property or a holiday home.

 

Loan parameters: 

• You may use up to 60% of your Vested Pot, after tax deductions (please refer to your latest benefit statement for details).
• The administration fee is R23 per month. 
• The minimum loan repayment period is 12 months.
• The maximum loan term is 240 months, equivalent to 20 years.
• The interest rate is prime minus 1.15%.
• There is also a one-time initiation fee of R300.

Click here for more information on the FNB Pension Backed Loan

Submit the following documents to Email:smarthousingplandocs@fnb.co.za.

Required Documents:

• Most recent pay slips.
• Certified copy of your ID.
• Proof of residence.
• Three months' bank statements (if not banked with FNB).
• Building quotation or offer to purchase.

Active members of the ISASA Retirement Fund are eligible to apply for a housing loan.

The loan amount is determined based on the value of the member's accumulated pension savings and the affordability assessment conducted by the bank.

The loan repayment is structured to be deducted directly from the member’s salary.

The maximum repayment period is typically aligned with the member's expected retirement date, ensuring that the loan is repaid before retirement.

1. Access to Lower Interest Rates:

Using pension savings as collateral often results in lower interest rates compared to unsecured loans, making the loan more affordable.

2. No Need for Additional Security:

Members do not need to provide additional security or assets to secure the loan, as their pension savings serve as collateral.

3. Simplified Approval Process:

The use of pension savings simplifies the approval process since the risk to the lender is reduced, leading to quicker loan approval and disbursement.

Members should be aware that any outstanding loan amount at the time of retirement or if they leave the Fund will be deducted from their retirement benefits, which may impact their retirement savings and tax liabilities.

It is advisable to consult with a financial advisor to understand the long-term implications of taking a loan against your pension savings. This will ensure that you make an informed decision that aligns with your financial goals and retirement planning.

For more detailed information, submissions and assistance with your housing loan application, please contact:

HR Department: For initial queries and guidance.

Old Mutual Service Centre: Tel 0860 455 455 or Email at isasa@oldmutual.com.

FNB Help Desk: Tel: 0860 762 278 or Email:smarthousingplandocs@fnb.co.za.