Joburg entrepreneur keeps home after defaulting on business loan

A Johannesburg businessman has been granted what may prove to be a reprieve after the Johannesburg High Court postponed an application by financial services firm Business Partners to seize his home following a default on business loan repayments.

Business Partners Limited had advanced a R1.2-million loan to Nqobile Themba Ngwenya’s company, IPG Building Glass, in May 2024. As security for the loan, Ngwenya and the Obadayo Family Trust, of which he is a trustee, provided suretyships and a surety bond over a property in Witpoortjie where Ngwenya resides.

“The bond was passed over a property in Witpoortjie, in which Mr Ngwenya resides. Mr Ngwenya confirmed at the hearing that the Witpoortjie property is his primary residence. It is also clear from the papers that Mr Ngwenya is the sole registered director of IPG,” the court heard.

After IPG Building Glass defaulted on its repayment obligations, Business Partners approached the court seeking a money judgment of just over R1.6-million and an order declaring Ngwenya’s home specially executable.

The matter, which was enrolled as an unopposed application in the motion court on September 3, 2026, was postponed to February 1, 2027, with costs reserved.

Court papers show that the R1.2-million loan was secured by a suretyship signed by Ngwenya and a second suretyship signed by the Obadayo Family Trust.

On May 8, 2024, Business Partners advanced a further loan of R150,000 to IPG, reportedly for accounting and financial reporting software. That loan was also secured by the same suretyships and surety bond.

The R1.2-million facility was repayable in 57 monthly instalments of just over R30,000, while the R150,000 loan was repayable over 48 months at slightly more than R3,000 a month.

“In due course, IPG defaulted under both loan agreements,” the judgment states.

As a result, Business Partners asked high court judge J Wilson to enforce its securities by granting judgment for the full outstanding amount under both agreements and declaring the Witpoortjie property specially executable.

Ngwenya appeared in person and requested additional time to meet his obligations under the loan agreements and the suretyships he had signed.

In his judgment, Wilson explained why he believed a postponement was warranted.

“Under normal circumstances, I would be reluctant to delay a matter of this kind unless there was confidence that a practical plan could be developed and put into effect to restore the debtor’s financial performance. However, in this instance, I was persuaded that granting a postponement was justified,” Wilson said.

Court delays execution to allow exploration of refinancing options

The judge further observed that the surety bond was the only encumbrance registered against Ngwenya’s property, which is valued at about R1.8 million.

“At present, Mr Ngwenya is unable either to settle the full outstanding debt arising from the two loan agreements for which he acted as surety or to meet the combined monthly repayments of nearly R35,000 required under those agreements,” Wilson noted.

Despite this, Ngwenya maintained that he would be capable of servicing repayments if the debt were restructured into a conventional mortgage bond secured against his home.

“This is because the two loans for which Mr Ngwenya stood surety are repayable over periods of between four and five years. An ordinary mortgage bond, though, would be easier to service, in that payments, albeit at a higher interest rate, would be spread over 20 years.”

Wilson noted that counsel for Business Partners, Mr Naudé, accepted the court’s suggestion that a mortgage bond for the amount owed would likely result in monthly repayments of about half the amount currently payable under the existing loan agreements.

“In these circumstances, it seemed plain to me that execution against Mr Ngwenya’s home might be avoided if the loans at issue in this case could be spread over a longer repayment period, or if the amounts due under the suretyships could be paid in full by means of ordinary mortgage finance raised against the property from another lender,” Wilson said.

The judge said the postponement was intended to allow the parties time to explore those alternatives before the court considered a forced sale of the property.

“It was to explore these possibilities that I postponed the application to 1 February 2027. To do otherwise would be to countenance execution against Mr Ngwenya’s home in circumstances where such execution might be disproportionate, because there are other readily apparent ways of meeting Mr Ngwenya’s liabilities without selling his home.”