You spelled "privileges" wrong :-)

South African banks are not like US banks - they are far less likely to give credit (they’ve been nailed on numerous occasions for irresponsible lending, so now they’re on the opposite side of the lending fence)

The point you omit here is like so : you may be an individual to yourself, or to your wife, or to your friends. But for strangers you are just a member of your group. Another group, the South African banks, have sunk some money and other resources into determining that you as a group shouldn't be lent to. So the only reasonable conclusion Bitcoin lenders - whose interests are exactly mapped on the SA bank's, incidentally - could come to would be... exactly the same.

Executive summary : you don't escape a group just like that, because you in your head see yourself as different. Which goes right into this older article.

As I said in the post (shown in the screenshot) - "At this juncture I'm not willing to risk borrowing and re-paying on BTC that is unlinked to fiat currency." BTCJam at the time (not sure about now) had a mtgox-linked rate, where you borrow based on the USD rate and repayments are linked to that USD rate. It would have been ludicrous to borrow it unlinked, as you pointed out.

Also, this was an attractive idea for me because the South African banks are not like US banks - they are far less likely to give credit (they've been nailed on numerous occasions for irresponsible lending, so now they're on the opposite side of the lending fence) and their interest rates are insane compared to the EU and the US. The effective APR for the BTCJam loan would have been significantly better than from the local financial institutions. Security was offered by virtue of the home loan being collateral (there's a legal precedent and instrument for this here, as it is commonly done in South Africa), but again it would have been at the fiat amount and not at the BTC amount.

We ended up funding this by taking the money out of one of our access bonds. I initially calculated the cost implication of doing this based on the bond on the property in question, but it turned out to be cheaper to take it out of one of the bonds on another property that was basically paid off. Had I known that I wouldn't have gone down this road at all:)

Had I been given the loan, however, it would have been better than the offer from the banks, so I would have been better off. Lenders would have suffered, as BTC rose more than the ~20% (in USD terms) I would have ended up paying, but that is the nature of things.