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A person or company switching or applying for a second bond will only be
allowed to access the money from the bond once the new bond has been registered.
If the bond has been approved by a financial institution we can advance up to
80% of the bond amount immediately.
Example:
For purposes of this example, Mr Jones moves his home loan from one bank to
another. If he has been granted a larger home loan, a surplus will be available
on registration. The process of switching may take up to three months. If he
wishes to access some of the surplus funds, we will advance him a percentage of
the surplus available.
The surplus is calculated as follows:
| New bond amount |
R 500,000 |
| Less: Existing Bond Cancellation
Amount |
R 200,000 |
| Attorney's Fees |
R 2,500 |
| Surplus Available |
R 297,500 |
We will advance Mr Jones up to 80% of the Surplus Available. We will charge
an upfront initiation fee of 1.5% (Minimum of R150 and maximum of R1,000 Excl
VAT) of the amount advanced, plus a daily interest rate of R1.1808 per R1,000
advanced. If we assume that the loan is outstanding for 20 days before the
transfer takes place, the calculation for the total cost of the bridge loan is
as follows:
| Loan Amount |
R 238,000.00 |
| Interest Cost (R238 x 20 x R1.1808) |
R 5,620.61 |
| Initiation Fee (1.5% up to R1,000
Maximum) |
R 1,140.00 |
| Administration Fee |
R -0- |
| Service Fee |
R -0- |
| Discount Fee |
R -0- |
| Total Cost of Loan |
R 6760.61 |
Other Articles:
Bridging Finance ApplicationAbout Us - Invela Financial CorporationFrequently Asked QuestionsEstate AgentsProperty SellersInvela Bridging Finance Loan Products
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