How does a first-time homebuyer loan work?

A first-time homebuyer loan works the same way as any home loan, except that the bank may be more willing to grant special deals for first-time homebuyers, such as the 100% home loan which removes the need for a deposit.

First-time homebuyers also have exclusive access to the government subsidy known as First Home Finance (FLISP). This is available to first-time homebuyers with a low income (R3 501 to R22 000 per month).

There is increased competition between banks to secure home loan customers, and first-time homebuyers can take advantage of this by applying to multiple banks so they can compare the deals offered and choose the best one.