A seller of property is only paid the net proceeds from the sale on registration
of transfer. This lengthy process can take up to three months or even longer. We
offer sellers access to their funds within 24 hours. In order to advance the
money, we require that:
- Sales agreement with all suspensive conditions cleared
- Relevant Guarantees (Proof of finance to cover the transaction)
Example:
For purposes of this example, Ms Smith sells her property for R500,000.
Ordinarily, she would wait about three months to receive the proceeds from the
sale. If she needs to access some of the proceeds from the property sale prior
to registration of the transfer, we will advance her a percentage of the net
surplus available.
The net surplus is calculated as follows:
| Property Selling Price |
R 500,000 |
| Less: Bond Cancellation Amount |
R 200,000 |
| Agents Commission |
R 35,000 |
| Attorney's Fees |
R 25,000 |
| Rates and Taxes Due |
R 7,500 |
| Net Surplus Available |
R 232,500 |
We will advance Ms Smith up to 80% of the Net 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 30 days before the
transfer takes place. The calculation for the total cost of the bridge loan is
as follows:
| Loan Amount |
R 186,000 |
| Interest Cost (R186 x 30 x R1.1808) |
R 6,589 |
| Initiation Fee (1.5% up to R1,000 Maximum) |
R 1,140 |
| Administration Fee |
R -0- |
| Service Fee |
R -0- |
| Discount Fee |
R -0- |
| Total Cost of Loan |
R 7,729 |
Note: VAT is inclusive and ONLY charged on the initiation fee above.
Being a registered credit provider means that our rates and fees are among the
lowest in the market.
Rates & taxes
Mr & Mrs Tolken are selling their home. In order for the sale to be registered
with the deeds office, a Rates and Taxes Clearance Certificate needs to be
issued by the local council. The arrears on the rates and taxes account need to
be settled immediately, but Mr & Mrs Tolken are not able to come up with the
cash in such a short period of time. We will advance them the money to settle
the rates and taxes from the net surplus available from the sale of the
property. The net surplus is calculated as follows:
| Property Selling Price |
R 500,000 |
| Less: Bond Cancellation Amount |
R 200,000 |
| Agents Commission |
R 35,000 |
| Attorney's Fees |
R 25,000 |
| Rates and Taxes Due |
R 7,500 |
| Net Surplus Available |
R 232,500 |
We will advance Mr & Mrs Tolken up to 80% of the Net Surplus Available, thus
the R7,500 required for rates and taxes can be advanced. 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 15 days before the
transfer takes place, the calculation for the total cost of the bridge loan is
as follows:
| Loan Amount (Rates and taxes outstanding)
|
R 7,500.00 |
| Interest Cost (R7.5 x 15 x R1.1808) |
R 132.84 |
| Initiation Fee (1.5% up to R1,000 Maximum) |
R 171.00 |
| Administration Fee |
R -0- |
| Service Fee |
R -0- |
| Discount Fee |
R -0- |
| Total Cost of Loan |
R 303.84 |
Note: VAT is inclusive and ONLY charged on the initiation fee above.
Being a registered credit provider means that our rates and fees are among the
lowest in the market.
Other Articles:
About Us - Invela Financial CorporationFrequently Asked QuestionsEstate AgentsBond SwitchersInvela Bridging Finance Loan Products
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