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Bridging Finance

If you already own land or you are thinking of buying land with the intention to build your own home, you will require Bridging Finance. This type of financing is intended to bridge the gap between construction and the completion of your home ensuring that funds are made available during the construction phase. Once the dwelling has been completed and a completion certificate along with an updated valuation report are submitted, the bridging financing will be converted to a long term mortgage loan. 

 
 

How does Bridging Finance Work?

  • Bridging Finance refers to the actual funds required to build your own home.
  • Bridging Finance provided for the construction your home should not exceed 90% of the projected value of the land with the completed building.
  • Funds are released in drawdowns based on site visits conducted by the bank officer and the submission of quantity surveyors’ reports which highlight the progress of construction.
  • Interest is charged by the Bank only on the funds actually utilized during construction. Principal repayment is not required during the bridging phase.
  • The building must be constructed in accordance with approved building plans.
     

Documentation Required

The documents required for bridging financing are the same as outlined previously for purchasing a home however some additional documents would be required by the Bank.

 
Based on our earlier programme we would now recap the basic documents required by the Bank if you are purchasing your home. These are:


1. A job letter stating salary, allowances, status of employment and length of service as well as a recent payslip. For self employed persons you can provide financial statements (prepared by an accountant) for the last 3 years supported by bank statements.


2. Purchase Agreement or Offer for Sale between purchaser and the vendor.


3. A copy of the title document i.e. Deed of Conveyance/Lease /Certificate of Title


4. Valuation report from a valuer on Bank’s panel.


5. Statements from other financial institutions reflecting savings and investments held and loan balances/instalments.


6. Two forms of identification and proof of address.


7. Copies of up to date receipts for Land and Building taxes, lease rent and WASA rates.


8. A WASA Clearance certificate

 

The additional documents required by the Bank if you are constructing your home are:

  • Approved building plans.
  • A Detailed Builder’s Estimate.
  • At least two (2) references on your potential builder.
  • A Quantity Surveyor’s Report.
  • A projected valuation report showing the value of the property upon completion of the residential dwelling.
  • In Course of Construction Insurance to cover the period of construction.

 

When construction of the building is completed two documents must be submitted to the Bank so that the bridging loan can be converted to a long term mortgage loan:

 

  • A Completion Certificate from the respective Borough/City Corporation
  • An updated valuation report showing the value of the property with the completed building. The valuator will also provide the recommended fire insurance coverage which should be obtained.

 

In the following programmes we will provide valuable tips which should prove useful if you are desirous of constructing your home.
 

 

  • Classic Credit Card “Shopping”
  • Card Safety Tips
  • E first
  • Contact Centre
  • Point of Sale Terminal
  • Mobile Banking