In the wake of last week's interest rate hike by 50 basis points, First National Bank (FNB) has urged struggling homeowners to come forward for help.
"These are tough times for the South African household," says FNB home loans chief executive, Jan Kleynhans. "The evidence indicates that the pressure from the rising costs of living is being felt by all types of consumers.
"We would advise customers who find themselves unable to honour home loan repayments to contact us and discuss repayment terms.
"The last thing we want is to repossess the homes of struggling customers. We would rather sit down with a customer and work out favourable ways in which they can repay their debt."
Kleynhans said one of the options FNB Home Loans uses to restructure debt was to allow customers to pay only the interest portion of the loan repayment if they are not in arrears. This type of arrangement might go on until the customers' financial circumstances improve.
FNB's new rates for new and existing FNB home loans were increased by 0,5percent on Friday.
The interest on a mortgage loan have risen by 32percent after this week's interest rate hike.
The cumulative interest rate hikes pushed monthly repayments on a R500000 mortgage over 20 years to R6583,95 from R4 991,90 in June 2006.