What is Bridging Loan? — Singapore property glossary

Q: What is Bridging loan?

A bridging loan is short term financing, typically 3.5 to 5 percent per annum over 6 to 12 months, that covers the cash gap when a buyer's new property completes before their existing property has been sold, repaid once the sale proceeds arrive.

What is Bridging loan? A bridging loan is short term financing that covers the cash gap when a buyer's new property completes before their existing property is sold. Singapore bridging rates typically run 3.5 to 5 percent per annum for a tenure of 6 to 12 months, and the loan is repaid in full once the old property's sale proceeds come in.

Bridging loans are most common for HDB upgraders moving into a private property before their HDB flat sale completes, since the new down payment and legal costs are due well before the old flat's proceeds are received.

The practical playbook: qualify for the bridging repayment under TDSR alongside the new mortgage, size the bridge to cover only the genuine downpayment shortfall rather than the whole gap, and use the eventual sale proceeds of the existing property to clear the bridge in full at completion.

Because bridging rates run meaningfully above typical mortgage rates and are only intended to be short term, a bridging loan should always be paired with a realistic, dated plan to sell the existing property, not used as open ended financing.

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Winfred Quek is an Associate Marketing Consultant at Crestbrick Pte Ltd (CEA Licence No. L31010886H). CEA R073319H. This page is for general information only and does not constitute financial, investment, or legal advice. Verify current figures with IRAS, HDB, CPF Board, or MAS before making any decision.

Bridging loan

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