• Empower Funding

What Are Suspensive Conditions?

And what does this have to do with bridging finance? Read on to find out!


If something is “suspended”, it means it is literally hanging in the air. Figuratively, if something is up in the air, it means it is not a for sure thing. As in, “I am not sure if we are going out for dinner tonight, it’s still up in the air."


A condition is a specific thing that must happen. As in a mom telling her child, “You can watch TV on one condition: if I say bedtime, we switch it off right away!” A condition is also a specific thing that must happen or which is agreed upon in a contract.


So, a suspensive condition is a part of a contract that says the deal is not for sure, it’s up in the air, UNLESS this specific condition or step is done.


It means if “A” happens, then the deal goes ahead. If “A” doesn’t happen, the deal is off. Everyone agrees to this so there is no confusion or upset later. If the deal is off due to a suspensive condition, this is one example where the buyer could or would get his deposit back.


Examples of Suspensive Conditions:


An example of a suspensive condition is: “I am planning to sell my home to you, but I need another home to live in if I do. I have 30 days to find myself a new home… If I do, the deal is on. If I don’t, I am not obligated to sell you my home.”


Another example: “I am going to buy the home ONLY if I get approval for R1,000,000 from the bank within the next two weeks. If two weeks have gone by and I didn’t get approval for a bond, the deal is off.”


Suspensive conditions are normal parts of contracts. We need to ensure the conditions are met, meaning these things that must be done, get done.


Only when there are no suspensive conditions, or they have been met, are we able to issue bridging finance.

Learn more about our bridging service here: www.EmpowerFunding.co.za


Send us an email to info@EmpowerFunding.co.za if you would like to get in touch with us!


Find more Frequently Asked Questions here: www.empowerfunding.co.za/faq

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