Property Bridging Finance

Need Cash Flow Before Your Property Sale Completes?

APPLY NOW

Up To 75% of nett sale proceeds in cash NOW

A property bridging loan provides short-term funding to bridge the gap between when you need cash and when your property sale finalizes. Typically, these loans offer an advance of up to 75% of the expected sale proceeds or commission.

 

Property bridging loans can help you to:

Improve cash flow

Maintain a steady income stream during the property sales process as an estate agent.

Reduce financial strain

Buying & selling property is expensive! Avoid the financial stress of waiting for funds from the sale.

Accelerate purchases

Use the funds to quickly secure your next property.

Cover unexpected expenses

Address unforeseen costs that may arise during the sales process such as repairs, transfer fees, conveyancer fees and levy advances.

Maintain your lifestyle

Continue your current lifestyle without financial disruption while awaiting sale proceeds.

What You Need To Know

Sellers Cash Advance

Selling your property can take time. A property bridging loan can provide a cash advance based on the expected sale price, giving you immediate access to funds. This allows you to cover living expenses, pay off debts, or make a deposit on your next property without waiting for the full sale proceeds. You can apply for up to 75% of the nett proceeds from your pending sale as long as all suspensive conditions have been met and the transfer documents are with the conveyancing attorneys. 

Estate Agent Commission Advance

As an estate agent, you have to wait for the property to lodge and register with the new owners before you are paid your commission by the conveyancers. In the meantime, you have costs to cover such as travel, marketing and general living expenses. Not to mention the deeds office can experience delays, as can property transactions due to seller/buyers. Get up to 75% of your commission as a cash advance.

Levy/Rates Cash Advance

Selling a property often requires obtaining clearance certificates from the relevant authorities:

  • Levy Clearance Certificate: If you live in a sectional title complex or estate, you will need to obtain a levy clearance certificate from the body corporate. This certificate confirms that all outstanding levies and other charges have been paid.
  • Rates Clearance Certificate: You will also need to obtain a rates clearance certificate from the municipality. This certificate confirms that all outstanding property rates and taxes have been paid.

Transfer Duty Loan

Transfer duty can represent a significant expense, especially for high-value property transactions. A bridging loan can provide the necessary funds to cover the transfer duty costs.

  • Avoid Delaying the Sale: By securing a bridging loan for transfer duty, you can ensure a smooth and timely transfer process.
  • Maintain Cash Flow: Retain a larger portion of your sale proceeds for other purposes while the transfer duty is covered by the loan.
  • Flexible Repayment: Repay the loan once the transfer is complete and the sale proceeds are received.

Costs

Loan Cost and Conditions :

Minimum amount        R 10 000

Maximum amount       R 100 000 000

Minimum Term            61 days

Maximum Term          12 months 

Minimum APR             29,76 %

Maximum APR            30 % 

Loan Cost Example

Loan                                        11 000

Term                                        61 Days

Rate                                        0,15 % per day

61 day interest                        R 1006.50

Total repay after 30 days        R11006.50

Frequently Asked Questions

How do I pay for levy or rates clearance certificates?

Both the levy and rates clearance certificates typically require the payment of a few months’ levies/rates in advance to ensure that the body corporate/municipality is protected during the transfer process. This ensures that any outstanding amounts are covered and prevents potential disputes after the sale. You can use a property bridging loan to cover these costs, which can be expensive when dealing with high-value homes. If you are moving to a gated estate, you may have to pay a levy stabilisation fee. This amount can range from as little as R10 000 up to in excess of R100 000. If you don’t have this cash handy, you can use property bridging finance to cover the costs and avoid delaying the sale. 

How long is the typical loan term?

Loan terms for property bridging loans are generally short-term, typically ranging from 8 weeks to 12 months.

Who is eligible for property bridging finance?

Sellers and estate agents are eligible parties for property bridging loans. Specific criteria includes: 

  • Signed sales agreement
  • All suspensive conditions met 
  • Transferring attorney engaged (docs are with the conveyancer)
Can I pay transfer duty in installments?

No, you cannot typically pay transfer duty in installments.

  • Transfer duty is a lump sum payment: It’s a tax payable to the South African Revenue Service (SARS) on the transfer of property.  

  • Due within a timeframe: You usually have a specific timeframe (typically within six months of the property acquisition) to pay the full amount of transfer duty.   

However, there are some indirect ways to manage the cost:

  • 105% Home Loans: Some lenders offer 105% home loans, where the extra 5% can be used to cover transfer costs, including transfer duty. This effectively spreads the cost over the loan repayment period.   

  • Bridging Loans: As mentioned earlier, a bridging loan can provide temporary funding to cover the transfer duty upfront, allowing you to repay it later.
What is bridging finance for transfer costs?

Bridging finance for transfer costs is a short-term loan designed to cover the expenses associated with transferring property ownership.

Here’s how it works:

  • Covers Transfer Costs: This type of bridging finance specifically targets the costs involved in transferring property, such as:

    • Transfer duty: A tax paid to the South African Revenue Service (SARS) on the transfer of property.
    • Conveyancing fees: Legal fees charged by attorneys for handling the legal aspects of the property transfer.
    • Registration fees: Fees charged by the Deeds Office for registering the transfer of ownership.

  • Short-Term Solution: It’s a temporary loan typically used to bridge the gap between when these costs are due and when the property sale is finalized and the seller receives their funds.

  • Repayment: The loan is typically repaid once the property sale is completed and the seller receives their proceeds from the sale.

Benefits of Bridging Finance for Transfer Costs:

  • Smooth Transaction: Ensures the transfer process can proceed smoothly without delays caused by insufficient funds.
  • Avoids Financial Strain: Prevents the seller from experiencing financial hardship while waiting for the sale proceeds to arrive.
  • Maintains Cash Flow: Allows the seller to maintain their cash flow and cover other expenses during the transfer period.
Do you pay monthly payments on a bridging loan?

No, you typically do not pay monthly payments on a bridging loan.

  • Lump Sum Repayment: Bridging loans are designed to be short-term, usually repaid in a single lump sum at the end of the loan term.  
  • Interest Accrual: Interest on the loan typically accrues daily or monthly and is added to the principal amount.

APPLY FOR A PROPERTY BRIDGING LOAN

This form applies to the following bridging loan categories:

Rates and Taxes Bridging | Sellers Proceeds | Estate Agent Commission Bridging | Further Bond Bridging | Levy Bridging | Transfer Duty Bridging

Please only submit the form ONCE! Check your inbox (and spam folders) for a confirmation email.