For those selling their homes, estate agents and property developers, having access to funds is a high priority. However, not any method of gaining finance will do when it comes to making property transactions run smoothly. These transactions require fast and flexible finance.
Bridging finance offers just that. This form of finance combines a quick supply of significant flexibility, with a range of other benefits. That said, exactly how long does it take to get bridging finance?
In this article, we delve into this so you can be well-equipped to make this decision should you need to.
What is bridging finance?
Bridging finance is a financial solution, typically in the residential property market, where sellers need capital for deposits on another purchase and cannot wait until transfer.
Andrew Church, our CEO, explains: “As a rule, bridging finance is only advanced to sellers once they have sold their properties and the conditions of the sale have been met, with the loan period averaging 45 days.”
The qualities of bridging finance make them well suited to these transactions, allowing property sellers who are essentially also home buyers to fund their requirements quickly.
Properties can be purchased without the obstacles present in other forms of finance. This ensures you have the chance to seize an opportunity, rather than watch it sail by.
Apart from its use in seller transactions, bridging finance can be used for other things, such as providing advances on transfer duty and arrear rates as well as advances on estate agent and bond origination commissions.
How long does it take to get bridging finance?
“Bridging finance is a very specialised field and requires a very quick turnaround time,” says Church, “which is why the larger, more cumbersome institutions do not play in this space”.
“We pay out 75% of all applications within 24 hours, with the majority of those being on the same day we receive them and we work with 2500 law firms with whom the deals are structured.”
Though the method as a whole is fast, exactly how so depends on the conditions of the client’s transaction. For some, we will process an application and deposit funds in the borrower’s bank account within 24 hours.
Speeding up the process
As with any transaction, delays can happen, but this can be avoided. The quicker the required documents are submitted to us, the quicker you will receive your funds.
Firstly, ensure that you have your important documents at hand. Every bridging deal will require a copy of your ID and a copy of the sale agreement. For deals between R75 000 – R1mil, proof of a secured purchase price and a copy of the Bond Cancellation figures are required. Having all this information ready prior to submitting your application will streamline the process, resulting in a quicker turnaround.
The second factor is your choice of conveyancer. Having an efficient conveyancer to handle your paperwork and liaise with us will be helpful, speeding up the process significantly.
Conclusion
Bridging finance is an excellent method of gaining early access to the money due to you for various property-related transactions – quickly and securely. If you want to know more about how we can assist in bridging a financial gap in your property transaction, give us a call on 031 303 7722 or email: info@rodel.co.za.