What is a "Bridge Advance Loan"

"Working capital" we often hear, but "bridge advance" everyone seems to feel a little strange, in fact, to put it bluntly, the meaning of the two is not too different. "Bridge advance" is an advance loan, for example, A gets a project, but A itself temporarily lacks funds and has no ability to operate, so find B to help, let B help pay this fund first, and when A's funds are in place, B withdraws, then the money B in this process is called "advance".



Because the advance itself is a temporary act, the advance loan is a short-term loan, that is, a transitional loan. Its term is not more than one year, the interest rate is relatively high, 2% to 5% higher than the general loan interest rate, mainly with some collateral such as real estate or inventory for collateral.

Advance loans are suitable for businesses as well as for individuals.

For example, if a company is conducting a round of equity financing that is expected to end in 6 months, the company meets its working capital needs through a bridge advance loan, and then repays the bridge loan by issuing bonds in the future.

For individuals, advance loans are generally used in the real estate sector. For example, there is a common phenomenon that people often have a time lag between selling one property and buying another property, because the property is a large piece of real estate, and the sale will not be so fast, so the use of bridge loans can provide more flexibility for private home owners. Advance loans can help individuals buy new properties before they sell their property.

Advance loans can take the form of term loans or revolving lines of credit that can help individuals and businesses quickly resolve their funding problems. However, Xiaobian would like to remind everyone that there are many lending institutions that can provide advance funds on the market, and you must polish your eyes when choosing, and the relevant documents of your own property must confirm the credibility of the institution before submitting.

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