Whether you are married in or out of community of property, the type of marriage contract signed determines whether purchasing a house and financing it via a home loan requires the consent of both spouses.
Customary marriages
In many African cultures, the conclusion of lobola negotiations marks a major milestone, symbolising the formal union of two families. While this deeply rooted tradition is widely embraced, fewer people are aware of how customary marriage (or marriage in community of property) can impact current and future homeownership.
Speaking to the long-standing tradition of lobola, Hopewell Sathekge, director at STBB Attorneys explains: “Lobola is widely practiced, and each culture has its own set of rules and practices.”
Commonly known as ‘bride price’, lobola negotiations take place between the families of the prospective groom and bride. “The prospective groom’s family undertake to make payment (traditionally in cattle, but in recent times in the form of money often equated to the value of cattle) to the prospective bride’s family in consideration of a customary marriage. This serves as a token of gratitude and an introduction to the family,” he continues.
Sathekge adds that once the negotiations are concluded and customs are observed, the couple would be married under the Recognition of Customary Marriages Act (1998), providing them with the same legal status as civil marriages.
He points out that while civil marriages take place in a church or in front of a marriage officer, and require a marriage certificate, customary marriages follow the customs of the community and are far more flexible.
“However, what isn’t as commonly known (or widely spoken about) in customary marriage, is that once lobola negotiations are concluded, and unless otherwise stated in an antenuptial contract, couples are in fact married in community of property, meaning that assets – like a home or car – and liabilities – like debt – are equally shared,” says Sathekge. “Therefore, when the time comes to buy a home or split assets, there are several important factors that a couple married in community of property must consider.”
Applying for a home loan in community of property
“In the case of a marriage in community of property, both parties are required to apply jointly for the home loan, regardless of whether they’re a first-time or second-time homebuyer, and the home will be registered in both parties’ names,” says CEO of ooba Home Loans, Gavin Lomberg.
With this in mind, Lomberg adds that it’s important that couples have a clear understanding of how being married in community of property directly impacts on their legal obligations and access to credit and loans.
“Without proper knowledge and planning, this legal arrangement may complicate decisions around property ownership, debt management, and long-term financial security,” he says. “Navigating this aspect of your marriage requires thoughtful consideration to ensure your homeownership goals align and this is where pre-approval of a home loan becomes vital.”
Speaking to the home loan pre-approval process, Lomberg explains that both parties will need to have their credit scores and affordability assessed to determine whether they qualify for a joint home loan, and what they can realistically afford.
“Credit scores of 610-plus are required for both parties,” he explains, highlighting that a credit score is used by the banks to determine credit behaviour and whether applicants will be able to repay a monthly home loan on time each month.
“For those without a credit score or with a poor credit score, you can take steps to improve your credit score such as repaying your debts on time and in full. Once you have done so, you can request another free credit score check via ooba’s Bond Indicator. This can be done every three to six months.”
Once a couple’s affordability and credit scores have been checked, a pre-qualification certificate is issued and is valid for 90 days.
Lomberg adds that a potential advantage of a joint home loan is the possibility of being approved for a bigger home loan. “In the case of a joint home loan, some applicants may be approved for a bigger home loan as both incomes are pooled together. They may also be more likely to receive bank approval as the debt obligations fall on two parties, providing the bank with greater peace-of-mind. In addition, couples may receive competitive offers from the banks when shopping around.”
Conversely, if one party has a poor credit score and low affordability, it may hinder your chances of being approved for a home loan.
In the case of death or divorce, assets are divided equally between the two parties, as Sathekge explains: “If a couple has not previously opted to formally register the customary marriage and wishes to file for divorce, they will need to go to court and get a divorce order. They will also be required to produce affidavits to prove that they are married.”
To purchase a home prior to or after negotiations?
With all of this in mind, Sathekge and Lomberg weigh in on the topic of whether to purchase a home before or after the lobola negotiations.
“Like with civil marriages, there is no right or wrong, it simply comes down to personal preference,” says Sathekge.
For some, owning a home prior to lobola negotiations may be viewed as a sign of financial stability, underscoring their ability to provide for each other. For others, they may choose to purchase a home together once they have embarked on the journey of marriage.
Either way, Lomberg believes that it is important to shed light on how being married in community of property can influence a home loan application and subsequent homeownership.
“Homeownership is an exciting journey, and we advise couples to work closely with a trusted provider to ensure that they have undergone all the mandatory checks prior to applying for a home loan,” he concludes.
