Bridging Finance

What is Bridging Finance

Bridging finance is a financial device by which your lending company lets you avail of your money earlier than you normally can by advancing the amount to you with some interest. This plan may also pay out money to a third party for you based on some future money that you are still going to receive.

Examples

A practical scenario of bridging finance would be one in which the client needs to refurbish his home or do some improvement on it but currently is not in possession of sufficient funds. If the future worth of the house will be more than its current worth, the lending institution can lend the client the additional funds he needs to realize the project.

Another example of how this works is the case where a client has sold his house but for some reason has not received full payment for it. In this instance, again, the bank can lend him what he is expecting to get from the sale in order to defray living expenses or perhaps buy a new property

Overview of advantages

Obviously, bridging finance has its advantages. By allowing your fixed assets to flow, you are able to pay loans which are due, make important business moves to avail of opportunities that are not always available, facilitate bid transactions with your business associates or clients with ready cash, make earnest payments and reservations, accommodate pay-later sales to your clients and get lower rates for yourself by paying for your purchases in full.

Specific services

There are many categories of bridging finance available to you whether you need to make a cash advance badly for personal, construction or business purposes. Things like:

1. helping you get your real estate commissions ahead of time,
2. availing you of your pension money at the moment you need it,
3. small and fast loans,
4. getting your inheritance money immediately,
5. getting yourself unlisted in a black list and others,
6. availing of cash to buy stocks and shares,
   
7. availing of cash for importations,
   
8. availing of funds for early payment of letters of credit,
   
9. availing of customer payments early (SMME) and
   
10. refinancing on your home loans,
    
11. consolidating debts,
    
12. availing of your cash shares early

among many others will allow you to take advantage of future income now, when you need it.

Additional insights

In a sense bridging finance hastens the business process for you. Besides, since you may be earning by reduced interest and commissions on certain bridging finance transactions, you could be making money while you are borrowing it. This means that in certain instances, you might be paying very little in interest for the convenience of quick cash. It won’t do harm to inquire…on the contrary.

There are many companies who offer this type of financing. Probably the company from whom you got your home loan might be offering such services. For the small interest that you will be paying them, you can have the convenience of having cash available whenever you need it.