Bridge Loans

Waiting for your provident fund to payout can be nerve-wracking.

Bridge Loans have come up with a solution that will save you time and give you the finances you need to get on with things. The pension bridging loans they offer are easy to apply for and affordable.

If you have a provident fund, your retirement, retrenchment or even resignation is the start to the next phase of your life.

However, the waiting period between filling out the forms to receive your pension and the actual payment can be up to 90 days.

You can use your pension bridging loan to cover the bills in the interim, pay off some outstanding debts, or fund a long overdue trip to the coast.

Understanding pension bridging loans

Pension bridging loans are by definition short-term loans that use your pending pension payout as security that you can pay back the loan. Bridge loans allow you to pay back your loan amount in one instalment or over six months.

The interest rate on short term loans may be slightly higher than what you would pay on a long term loan.

You can make up for higher fees by choosing a shorter repayment term. The shorter the term, the fewer monthly fees they'll charge you.

Quick top-ups available 

You can apply for between R300 and R7100. Bridge loans also allow you to top up your personal loan at any point. Their simple three-step application process can be done online or on an app on your phone.

Simply fill out a quick application form on their site, and you'll be contacted by one of their call centre agents who will provide you with all the relevant information to continue the process.

The service you receive from Bridge Loans is simple.

They provide you with a quick loan that is both easy to obtain and built specifically to help you through the gap between your last salary and your pension payout.

Pension bridging loans are secured loans

This means that the lender knows, for a fact, that you'll in future have the funds to repay the loan. In many cases, the security you offer to the lender can be in the form of property, vehicles, or other valuables that exceed the value of the loan you are applying for.

Pension bridging loans only accept a pension or provident fund payout as security. You'll be a much better deal with lower fees and rates on a secured loan because lenders see you as a low-risk investment. They know you can repay the loan, and if you don't, they have the assurance that they can claim the default fees from you.

The role your credit will play

A bad credit record may work against you when applying for a pension bridging loan. As all lenders do, Bridge Loans will ask you to consent to a credit check. Your credit record will affect the interest rate you'll be charged. Again it comes down to risk assessment.

If you have the luxury of time, clean up your credit report by checking it to see that there are no mistakes. If you find that the information on your credit report is incorrect, follow the prescribed channels and have it corrected. The next step is to pay off overdue accounts and as many of your outstanding debts as possible.

Fees that might be included in your loan:

• Interest 
• A monthly fee calculated as a percentage of your loan amount
• Initiation fee
• Once off fee also calculated as a percentage of the total loan amount
• Administration fee
• Set monthly fee to cover administration costs