Glossary | Funding

GLOSSARY

Glossary

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There are 9 Terms in this directory beginning with the letter B.
Balance
Balance is the amount of money available in a financial account. It can also refer to the remaining amount owing to a lender or creditor. A person’s current account has $1,500.00 in it. This is their balance. On the other hand, if the person borrows $20,000 for a personal loan, and after 2 years, owes $12,000, this is the outstanding balance owed.

Balance (Available Cash)
The balance shown for your Funding.com.au account is the amount you currently have left to invest in our loans on the platform. For example, if you top up your account for the first time with $5,000, once processed your available cash balance will be $5,000. As you then invest in loans your balance will decrease and your investment portfolio will increase.

Balloon Payment
A balloon payment is a payment at the end of a non-amortised loan. If a person borrows money and agrees to not make monthly payments, but make one big payment at the end, this payment is known as a balloon payment.

Bankruptcy
Bankruptcy is an official legal status of an entity or individual that cannot repay the debt it owes to creditors.

Basis Point
A basis point is a unit of measure for interest rates. One basis point is 1/100th of 1%, or 0.01% and is used to identify the percentage change in a financial instrument. If you borrow at a rate of 9.00%, you are borrowing at 900 basis points, or bps.

Bonds
A bond is a type of debt investment allowing an investor to lend money to a company which borrows the funds for a set period of time at a fixed or variable interest rate.

Borrower
A borrower is a legal name for an individual using funds from a business or individual for a set period of time upon the condition of promising to repay the loan. At Funding.com.au our borrowers can be individuals, companies, trusts ad SMSF’s.

Bridge loan
A bridge (or bridging) loan is a short-term loan that is used until long-term finance can be secured. This allows the borrower to meet immediate obligations by providing a cash flow instantly. These loans are often short term with higher interest rates. Examples of where our borrowers at Funding.com.au might use a bridging loan: • Purchasing a property where there is a quick completion deadline. • Refinancing a property to raise capital for business or other use. • Purchasing or refinancing a property that requires renovation or is unmortgageable by mainstream banks in its current state.

Broker
A broker (see also Intermediary) is a licenced professional who acts as a middleman in negotiations and transactions. A broker often receives commission for introducing the two parties. At Funding.com.au we use mortgage brokers as a key source of new mortgage applications (dealflow).