Bridging Loan for Property Purchase Explained: Frequently Asked Questions

A bridging loan Singapore is a short-term bridge loan property that funds your new property downpayment while awaiting sales proceeds from your existing home. Homejourney prioritizes your safety by verifying rates from trusted banks like DBS, OCBC, and UOB.

This cluster article answers key questions on bridging finance for Singapore buyers upgrading from HDB to private properties. It links to our pillar guide on Bridging Loan for Property Purchase Explained for full details.

What Is a Bridging Loan in Singapore?

A bridging loan, or short term property loan, covers the gap between paying for your new property and receiving funds from selling your old one. It's common for HDB upgraders buying condos before TOP or sale completion.

Under MAS regulations, these loans must settle within 6 months. Banks like Standard Chartered offer HDB bridging at 3M SORA + 2.50% p.a., with no processing fees. Maximum amount ties to net proceeds from your old property, often up to 20% of new property value.

Who Needs a Property Bridge Loan?

Ideal for scenarios like:

• HDB owners upgrading to ECs or condos, using CPF for downpayments.
• En bloc sales requiring quick new property buys.
• Investors bridging multi-property purchases.

Example: Selling a 4-room HDB at Punggol for $550,000 net proceeds. New condo at $1.2M needs $240,000 non-cash downpayment. Bridge $200,000 via bank, add $40,000 cash.

Bridging Loan Costs and Interest Rates

Rates range 5-6% p.a., higher than standard mortgages due to short tenure. For HDB, expect 3M SORA + 2.50% from partners like Standard Chartered.

The chart below shows recent interest rate trends in Singapore:

As seen, SORA fluctuations impact costs—track live on Homejourney's bank rates page. Compare DBS, OCBC, UOB, HSBC instantly.

Eligibility and Application Steps

Must meet TDSR/MSR, with proceeds covering loan. HDB rules limit to existing flat sales.

1. Secure sale approval for old property.
2. Sign new S&P, calculate downpayment gap.
3. Apply via bank or Homejourney—use Singpass for instant verification.
4. Get approval in days; no monthly payments.
5. Repay upon old property sale.

Homejourney simplifies: Calculate eligibility at our mortgage calculator. Submit one form for multi-bank offers.

HDB vs Private Property Bridging

HDB bridging funds downpayment pre-sale proceeds. Private allows up to net proceeds, potentially lowering LTV.

EC deferred bridging uses current CPF for 15% S&P, bridging 65% at TOP. Always verify with HDB rules.

Risks and Tips for Safe Bridging

High interest accrues daily—minimize tenure. If sale delays, costs rise. Insider tip: Time bridging post-OTP, pre-S&P for best rates.

• Compare rates on Homejourney from 10+ banks.
• Factor ABSD if applicable.
• Use proceeds excess for lump-sum mortgage prepayment post-lock-in.

Disclaimer: Rates vary; consult professionals. Homejourney verifies data for trust.

Frequently Asked Questions

1. How much does a bridging loan cost in Singapore?

5-6% p.a. on quantum, e.g., $200,000 at 5.5% for 3 months = ~$2,750 interest. Check real-time SORA on Homejourney.

2. Can I use bridging for HDB to private upgrade?

Yes, covers non-cash downpayment up to proceeds. Apply via Homejourney bank-rates for seamless process.

3. What's the maximum bridging loan tenure?

6 months per MAS; some private up to 18 months for accredited investors.

4. Do I need to pay monthly for bridge loans?

No, interest capitalizes; full repayment at end.

5. How to apply for bridging loan safely?

Use Homejourney: Auto-fill with Singpass, compare DBS/OCBC/UOB, connect to brokers. Search properties at Homejourney search.

Ready for your upgrade? Compare bridging loan Singapore rates and apply securely on Homejourney bank-rates. Dive deeper in our pillar: Bridging Loan Explained. Trust Homejourney for verified, safe property journeys.