Kganyago: Pay your mortgage in 5 years
Reserve Bank Governor Lesetja Kganyago says South Africans need to change their mindset when it comes to money.
He was briefing Parliament's Standing Committee on Finance on Tuesday.
"If your bank has given you a loan of a house for 30 years. There is nothing that stops you from paying it in five years. You will actually save a lot of money if you do.
"We are happy to buy a house for R500 000 and pay for it over 30 years. But we buy a car for R1 million that we are happy to pay for in 5 years. We have to change our psyche as society and understand that we are supposed to be building assets and a car is not an asset," he said.
The EFF's Floyd Shivambu challenged Kganyago, saying banks are responsible for the situation consumers find themselves in.
"It's almost impossible to get a housing loan for five years, it doesn't exist because they don't offer such products and always insist that if you want a housing loan, you must pay over a period of 20 or 30 years," Shivambu explained.
He says this practice is consistent at all banks.
"The consistency of such practices across all the banks has got features of a cartel that sits somewhere and says that when we give housing finance it must be for 20 or 30 years. So that if one bank rejects you the next bank says the same thing," said Shivambu.
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But Kganyago insisted that no bank will stop a consumer from paying their mortgage in five years.