Bridging finance is available to residential and commercial property owners in the following scenarios:

A. Where there is equity in a property and the owner has concluded a valid sale agreement.

B. When the owner has obtained approval for a new or additional bond to be registered over the property.

Usually transferring ownership of a property or registering a new or additional bond can take anywhere between 30-60 days. Generally the owner only obtains access to the surplus funds from the sale or new bond at the end of this period but there are often instances when the owner may need to access funds before this takes place. During this period, Rodel is able to provide the owner with bridging finance before registration of the sale or the new bond.

To facilitate this, the owner enters into a discounting agreement whereby Rodel acquires the equity/surplus for a fixed fee and, in return, immediately pays the owner up to 80% of the value of the equity/surplus. Rodel then obtains an undertaking from the conveyancing attorney that the equity/surplus will be repaid on registration of the transfer or the bond.

Mortgage Plus does not specify how the funds are to be used, but typically they are used for any of the following:

• as a deposit on a new property
• to pay transfer duty on a new property
• to cover the cost of outstanding rates/taxes/levies on the property being sold
• for repayment of personal debt
• to provide working capital funding for businesses

Example:

Sue sells house A for R1 million, she still owes ABSA R500 000 on the property. She puts in an offer to purchase house B for R1,2 million, she can however only obtain a bond for R1 million from FNB. The problem is that Sue does not have the R200 000 cash deposit to secure the purchase of house B.

A possible solution is that Sue can bridge the R200 000 from the proceeds of the sale of house A and use the cash to pay the deposit on the purchase of house B, thus ensuring that the purchase of house B is concluded successfully.

Limitations:

• Can’t be used for 1st time buyers
• Doesn’t apply if the seller sells for less than is owing to the bank, ie there is no equity to bridge.

Agent’s commission advances:

Mortgage Plus through Rodel will advance up to 80% of the commission due to a registered estate agent once all the suspensive conditions of the sale have been met.

Please contact us if you require any further information or would like to apply for finance:

Complete this short form online

011.327.4489 / 0861 1111 93

morne@mortgagepluscc.co.za

www.mortgagepluscc.co.za

Flat, smallholding, cluster or semi-detached?

When it comes to describing the type of property you live in, there are a number of terms and categories – some of which can be confusing.

Here is a quick and simple guide to the different types of properties out there and the meanings of their terms and classifications.

Full title

This is when the owner has full ownership rights to the entire property and its improvements. Full title generally refers to the following types of properties:

House

This is a normal free-standing domestic residence with an erf number.

Cluster home

This is a freehold property, usually in a development of similar houses. The development normally has limited access and security. Each house is individually owned and a levy may be charged for the upkeep and management of the property.

Residential property used for business purposes

This description is applied if the structure remains that of a domestic residential dwelling and more than half of the dwelling is used for business.

Small holding

A small holding consists of an estate no larger than 20 hectares, situated within 150km of a built-up area, and with a borehole or the potential to be connected to a local-authority water supply. To qualify for a home loan, there must be a dwelling on the property and the main source of income must not be from farming on the property.

Sectional title properties

This means each owner has the rights to only a section or unit of a building complex (such as a block of flats). Sectional title is the general form of ownership of any of the following:

Mini sub-type house

This is a small, subdivided portion of a larger property that is suitable for cluster housing development.

Semi-detached house

This is when two houses are attached to one another. They may be on separate stands and bonded individually as ordinary houses. They can also be on one stand and bonded together. Or they can be bought as separate units in a sectional title development.

Townhouse or flat

This type of property is situated in an approved sectional title complex of residential units only. Each owner pays a monthly levy towards the upkeep of the exteriors and communal facilities.

Duet house

This is similar to a semi-detached house, but the two houses are on one stand. The houses may be apart from each other or attached.

Please contact us if you require any further information or would like to apply for finance:

Complete this short form online

011.327.4489 / 0861 1111 93

morne@mortgagepluscc.co.za

www.mortgagepluscc.co.za