How does one get a bridge loan?

The ways for individuals to make bridge loans are as follows:

1. Provide information: the lending bank needs to issue a loan commitment letter or a sealed loan contract;

2. Preliminary review: review the bank loan approval, conduct certain investigations on the loan individuals, and complete the review report;

3. Review and approval: The bank loan business department needs to review and approve all information. And submit it to the superior department for signature and review;

4. Notarization: After the bank review is passed, the individual needs to sign the entrusted notarization together with the business marketing center;

5. Sign the contract: Both parties to the loan need to sign a contract, and the lender needs to provide relevant information including the purpose of the funds and a fund transition check. It also needs to provide joint liability guarantees from relevant personnel.

In real life, many corporate legal persons and natural persons are under financial pressure. When there is financial pressure, it can be solved through financing. There are many ways of financing, and it is common for funds to cross the bridge. Short-term financing method, is it illegal for individuals to cross funds?

Is it illegal for individuals to cross funds? It is one of the behaviors of private lending. Whether it is illegal for individuals to cross funds mainly depends on whether the interest payment complies with the provisions of the law.

"Provisions of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases":

Article 1 "Private lending" as mentioned in these regulations refers to natural persons, legal persons, and other organizations. The act of financial intermediation among and among themselves.

This provision does not apply to financial institutions and their branches established with the approval of the financial regulatory authorities to engage in loan business, arising from the granting of loans and other related financial businesses.

Article 26 If the interest rate agreed between the borrower and the lender does not exceed the annual interest rate 24, and the lender requests the borrower to pay interest according to the agreed interest rate, the people shall support it.

The interest rate agreed between the borrower and the lender exceeds the annual interest rate of 36, and the interest agreement for the excess portion is invalid. If the borrower requests the lender to return the interest that has been paid in excess of 36% of the annual interest rate, the people shall support it.

What does a bridge loan mean_What is the process like_Is the interest rate high?

What does a bridge loan mean?

"Crossing the bridge" literally means The above understanding means "bridging", which is a short-term funding arrangement to achieve the purpose of transition to long-term funding arrangement. It can be understood as a temporary or short-term loan provided by banks and other financial institutions to borrowers. It can be in the form of a term loan or a revolving letter of credit, which is more temporary in terms of time limit. Therefore, bridge loans are also called "bridge financing", "interim financing", "gap financing" or "swing loan".

For example: A lacks funds but has no ability to raise funds, so he seeks help from B. B quits after helping A get the funds. In this process, B completed a bridge loan. It was A who actually obtained the funds, and B only acted as a middleman.

Bridging loan process

① First, the lending bank and the loan applicant sign a loan contract and mortgage contract

② Secondly, the bank will review the information and then repay the loan. A credit investigation will be conducted on the applying company to understand the real reasons why the company cannot repay the bank loan when it is due, and an investigation report will be written

③After passing the review, the bank will conduct a series of levels of approval

④After approval, the bank and the borrowing company sign a trust agreement

⑤Require the customer to provide a blank check for the relevant fund transfer account

⑥Provide joint liability guarantees for the relevant companies and relevant personnel

⑦Final loan

Bridge loan interest rate

As far as I know, bridge loans mainly come from private lending or small financing investment companies, and the interest rate is 2 cents to 5 cents, and some are even higher. Among them, more than 70% have interest rates between 2 cents and 3 cents.

For example, if the agreed interest rate for bridge funds is three thousandths per day, that is, the "daily interest rate is about 3 percent," which is 17 times more than the bank's one-year loan benchmark interest rate. If you borrow 10 million yuan, you will need to pay interest of 3% per day. Ten thousand yuan.

Is a bridge loan safe?

①Guarantee method. The guarantee method of a bridge loan can be either a credit guarantee or a pledge guarantee. The prerequisite for a bank to accept a credit guarantee is that the other party has strong financial strength, good operating performance, healthy financial status, strong profitability, high credit level, and relatively standardized operations.

② The prerequisite for applying for a bridge loan is that the future fund-raising plan of the listed company or pre-listed company must be approved by the securities regulatory department, otherwise it cannot be applied.

③The term is short, because the bridge loan is a working capital loan and is a short-term loan, so the risk is relatively low.

In summary, bridge loans themselves are safe, but due to higher interest rates, they will increase the financial costs of the company.

Overview of the bank's bridge loan business process

When it comes to bridge loans, friends who don't pay much attention to the financial industry may not really understand it, but in corporate financing, it is is quite common. As we all know, bank loans have a certain term. After using the loan, the company must pay it back in full before it can continue to apply for the loan. In order to maintain the capital chain, bridge loans come in handy. The so-called bridge loan, also called bridge funds or bridge loan, is a kind of transitional loan with a generally short term. Its function is to make up for the time gap that the borrower needs to obtain financing. Currently, bridge loans are very common in corporate financing and real estate markets. Recently, there is also a trend of extending to personal loans and advance funds for property redemption.

Bank bridge loan business process

1. The borrowing enterprise applies for a loan, and the lending bank issues a conditional loan commitment letter to the borrowing enterprise;

2. Investigation The authenticity of the loan approved by the bank;

3. The loan banking business department will conduct a credit investigation on the loan company to understand the reasons why the company cannot repay the loan on time, and write an investigation report;

4. The bank reports the expected operation process of the business;

5. The bank approves the business and returns the approval form to the business center after approval;

6. Undertakes the business marketing center and borrowing The enterprise signs the entrusted notarization;

7. The borrower provides a blank check proving the purpose of the funds and the excess of funds;

8. The bank signs an entrusted loan agreement with the borrower;

9. Relevant enterprises and personnel provide joint liability guarantees;

10. Banks issue loans.

To sum up, bridge loans are short-term loans, usually no more than 6 months, and are an important channel for corporate financing and maintenance of capital chains. According to the policy, the "bridging funds" obtained by enterprises from banks can only be used for special purposes. When applying for a bridge loan for enterprise financing, if the existing funds are insufficient, you need to borrow from a third party (small loan company) and then apply to the bank. What needs to be noted is: 1. The financing cost for small and micro enterprises to apply for bridge loans is relatively high, which will increase the financial costs of the enterprise and create operational risks. 2. If bank plans are tight, resulting in slow lending, bridge loans will also put significant pressure on enterprises.

How to operate a bridge loan

The application process of a bridge loan: the borrower submits a loan application. The lending institution approves the loan application. After approval, the contract is signed. The lending institution entrusts another institution to issue the loan first. A lending institution makes a loan and another institution takes the loan back. The borrower repays the loan on time.

Bridge loan, also known as bridging loan, means that after financial institution A obtains the loan project, it is unable to operate due to a temporary lack of funds, so it consults with financial institution B to help disburse funds. , after A financial institution has funds in place, B will withdraw.

For B, this loan is a so-called bridge loan. In our country, policy banks such as China Development Bank, Export-Import Bank, and Agricultural Development Bank of China play the role of financial institution A, while commercial banks play the role of financial institution B.

In June 2021, the Guangzhou Local Financial Supervision Bureau notified companies not to carry out "bridge loans" and "property redemption loans" businesses, to reduce and settle existing stocks as soon as possible, and not to issue housing directly or in disguised form. Mortgage Loans.

The key elements of a bridge loan are a qualified buyer and a signed contract.

Generally, a lender issuing a mortgage on a new home will provide bridge financing as a personal note payable upon settlement of the sale of the property.

However, if there is no buyer for the property you own and want to sell, most lenders will place a lien on the property, making the bridge loan a kind of second mortgage ( second mortgage).

It is important to note that bridge loan lenders and borrowers should be concerned about the interest costs of the loan, up-front fees and the consequences of taking longer than expected to sell the property. .

Although bridge loans are short-term financing, they come with higher interest rates and higher up-front costs (typically higher than interest rates on loans with terms of just a few weeks or months). In fact, any secured loan is acceptable to a lender who can obtain an advance.

So if an individual holds stocks, bonds or insurance policies (insurance policy), it is best to use them as collateral to apply for a bridge loan.

In June 2021, the Guangzhou Local Financial Supervision Bureau notified companies not to carry out "bridge loans" and "property redemption loans" businesses, to reduce and settle existing stocks as soon as possible, and not to issue housing directly or in disguised form. Mortgage Loans.

That’s it for the introduction to the bridge loan process.