Pension-backed housing loan
The LA Retirement Fund offers its members access to a valuable pension-backed home loan scheme. This means that qualifying fund members can get surety for a home loan from FNB of up to 60% of their member share (i.e. the total amount saved up in their fund account).
The loan granted can only be used to buy a house or pay for alterations to a house you already own. Approval of the loan is still up to the FNB and is subject to the requirements of the National Credit Act. If you qualify, the loan amount is paid directly into your bank account and then the monthly loan installments will be deducted from your salary until the loan is fully paid.
If you withdraw from the fund and you still owe money on the loan, the amount you owe will be taken off your member share before you are paid out your benefit.
You will find a pension-backed housing loan application form under the forms and glossary section of the website.
Pension-backed housing loan fees
The following fees are deducted from your member share value:
- A once-off administration fee of RlOO paid to the Fund administrator
- A once-off initiation fee of R300 (incl VAT) paid to FNB – effective 1 July 2020 in respect of any new and top-up loans from this date
- A monthly administration fee of R11.50 (incl VAT) paid to FNB. The previous monthly administration fee of R6.96 (incl VAT) is still applicable in respect of any loans concluded with FNB before 31 October 2018 (excluding any top-up loans)