Did you know more than 40% of Singapore homeowners who move keep their sale open while buying, creating a short-term cash gap that needs fast funding.
We explain how a specialist short-term financing helps you buy a new home before your current property sells. In Singapore, this product is paired with your new home mortgage and usually lasts up to six months.
You’ll learn why the pricing differs from a standard home mortgage: the lender relies on your sale proceeds and the term is brief. We outline the common repayment approaches — Capitalized Interest and Simultaneous Repayment — so you can match the option to your cash flow.
Practical steps: check how much you need, set buffers for delays, and prepare documents early. We combine market know-how with hands-on support — Whatsapp us for a discovery session to clarify your numbers and options.
Key Takeaways
- Short-term financing helps bridge the timing between selling and buying a home.
- Pricing is different from standard home mortgages because the term is brief and depends on sale proceeds.
- Choose between capitalized interest or simultaneous repayment based on cash flow.
- Prepare documents early and build buffers for delayed property sales.
- Contact us via WhatsApp for a discovery session to review your options.
What Singapore Homebuyers Should Know Before Chasing Rates
Before you chase the lowest figures, understand what truly drives the total cost when buying and selling property at once.
Short-term financing for a new home often carries higher interest rates than a standard mortgage because lenders rely on your sale to repay the balance quickly. Typical extra costs include legal and valuation fees, plus administrative charges.
Your credit profile matters. Clean credit and a clear proof of sale improve approval odds and can lower pricing. Recent late payments or high card utilization can weaken your position.
- Don’t chase headline numbers: add legal, valuation and admin fees to compare true offers.
- Keep cash ready: stamp duties, lawyers’ fees, and potential carry costs can strain your cash flow.
- Read the terms: early repayment options, penalty waivers and capitalization mechanics change your real cost.
- Stress test timelines: if your sale isn’t firm, lenders may price higher or delay approval.
“Transparent preparation—credit clean-up and realistic timelines—will position you for a smoother process.”
We’ll help you prioritise what matters for your case — Whatsapp us for a discovery session to benchmark offers and uncover hidden costs.
Bridging Loans in Singapore: How They Work When You’re Buying a New Home
A temporary finance facility helps you complete a purchase while you wait for proceeds from your existing property to clear.
Why it must pair with your new home mortgage. Lenders require the short-term facility to sit alongside your new home loan because it directly supports the purchase transaction. This combined arrangement gives the bank assurance the purchase completes even if your sale is still pending.
Short-term by design. The facility usually runs up to six months. It exists only to close the timing gap until your sale completes. Repayment typically comes from the sale proceeds of your existing property, so align completion dates to reduce extra cost and admin.
Effect on your loan-to-value ratio. When structured well, this facility can boost your down payment and lower the final home loans amount you need. That can improve your LTV ratio and, in turn, your mortgage pricing.
- Use proof of sale progress (OTP/S&P) and valuation to strengthen approval.
- Plan drawdowns for option fees, completion balance, and stamp duty so timing fits your cash flow.
- We’ll model your numbers — Whatsapp us for a discovery session.
bridging loan interest rate: What Drives It and How to Secure a Competitive Deal
Lenders price short-term facilities around three simple risks: how certain your sale is, how strong the valuation looks, and how long the exposure lasts.
Key pricing factors include your firm option or signed S&P, your borrower profile, and the bank’s valuation of both homes. When completion dates align, lenders see less risk and can offer more competitive terms.
- Compressed costs: admin and funding fees are applied over months, so the apparent monthly charge is higher than a traditional home loan.
- Valuation matters: a conservative assessment can widen your funding gap and push up the quoted figure.
- Time and certainty: clear legal milestones and an early OTP lower perceived exposure and help you secure better terms from banks.
Comparing offers is more than chasing the lowest number. A truly competitive deal balances speed of approval, flexibility on early repayment, and certainty of drawdown. We’ll gather firm sale documents and valuation reports, then benchmark options across lenders to find the best fit.
Whatsapp us for a discovery session to review current interest rates and negotiate terms aligned to your timeline.
Types of Bridging Loans: Capitalized Interest vs Simultaneous Repayment
Different repayment setups trade immediate cash relief for final payout size — pick the one that matches your timeline.
Capitalized interest: defer and settle at completion
Capitalized interest adds accrued interest to the principal and is repaid from your sale proceeds at completion. You do not pay monthly while the facility runs, which helps preserve cash flow during the holding period.
Simultaneous repayment: pay as you go
Simultaneous repayment means you service both the short facility and your new home mortgage at the same time. That reduces total loan interest over the short tenure and can save money when the sale is near-certain.
Which suits you? Choose capitalized when cash flow is tight or completion dates are uncertain. Choose simultaneous if you have steady monthly capacity and want to minimise total cost over the months the facility is active.
- Capitalized Interest: best for cash relief; accrued amounts added to final payout.
- Simultaneous Repayment: suits stronger monthly budgets; lowers total cost across short tenures.
- We compare scenarios side-by-side and stress-test different completion dates and valuation shifts.
- Some banks offer more flexible early repayment on one structure—read clauses carefully.
- We coordinate with your lawyers to align disbursements and final settlement for a smooth exit.
Whatsapp us for a discovery session to run tailored calculations and pick the structure with the best total cost and cash flow fit for your home move.
Eligibility, Documents, and Application Path for Faster Approval
A clear eligibility profile and organised paperwork cut approval time dramatically. Lenders want to see identity, steady income, and a bona fide sale in place before they underwrite a short facility.
Who qualifies
Typically, Singapore Citizens or PRs aged 21+ with stable income and a clean credit record qualify. Proof that your current property is being sold — OTP or signed S&P — is essential.
Documents checklist
Prepare NRIC or passport, recent payslips, tax statements or CPF history, and S&P for both properties. Add professional valuation reports to speed sizing and reduce rework.
Submission flow
For HDB sellers, secure HDB approval first; applications often stall without it. For private property, submit directly to banks or financial institutions. Processing can take from a few days to several weeks depending on document completeness and valuation timing.
- Tip: A clean credit profile and full document pack helps approvals and better pricing.
- We coordinate: banker and conveyancing timelines so drawdown matches completion.
- Action: Whatsapp us for a discovery session to audit your file and pre-empt credit concerns.
Total Cost of a Bridging Loan: Beyond the Headline Rate
Total cost is more than the headline figure — it combines fees, accrued sums and timing gaps that can change your final amount.
We itemize the real bills so you can decide with confidence. Below we list the main cost components and practical ways to reduce what you pay.
Cost components
- Accrued interest: charged daily based on the drawn amount and tenor.
- Legal and conveyancing fees: solicitor work at completion.
- Valuation and admin fees: lender reports and processing charges.
- Early repayment terms: check for minimum charge periods or notice needs.
Strategies to reduce cost
Optimize LTV, shorten the tenure, and tighten timing to cut days that accrue charges.
| Action | Effect on total amount | Why it helps |
|---|---|---|
| Lower LTV on main mortgage | Reduces long-term borrowing | Lowers your larger mortgage and its lifetime charges |
| Coordinate completion dates | Fewer interest days | Minimises accrual between disbursement and sale |
| Choose simultaneous repayment | Can trim total costs | Paying monthly reduces capitalised sums |
“Small fee savings and tighter dates often beat chasing a lower headline number.”
Whatsapp us for a discovery session and we’ll build a tailored cost map showing how a one- or two-week delay affects your final payout.
Timelines, Cash Flow Planning, and Repayment
Timing your sale and purchase is the single most practical way to lower the total days you carry short-term financing.
Expect processing to take from several days to a few weeks. The speed depends on how complete your documents are and how quickly valuations are scheduled.
Common delays include missing evidence of sale, valuation backlogs, or last-minute changes to completion dates. We prioritise lenders with faster internal credit processes when time is tight.
Managing repayment and preparing backups
Repayment normally comes from the proceeds of your sale at completion. CPF funds cannot be used to repay this short facility, so plan other sources for interim payments.
Typical tenure runs up to six months, so aligning completion dates for both properties reduces days of accrual and keeps the final amount lower.
- Expect a processing period from several days to several weeks based on docs and valuation scheduling.
- Delays often stem from missing sale evidence, valuation backlogs, or changes to completion dates.
- We plan your cash flow so you can cover option fees, stamp duties, and any interim cash needs.
- We coordinate with lawyers to redeem the facility from proceeds at completion on time.
- Build a backup plan if your buyer requests an extension—short buffers or alternative liquidity help.
- Keep a calendar of key dates: OTP exercise, valuation appointments, offer letters, and completion for both properties.
We estimate daily accruals for you so you can see how even small delays add to the total. With careful planning, you’ll minimise the months of overlap and manage repayment smoothly at completion.
Whatsapp us for a discovery session to build a timeline and cash flow plan tailored to your sale and home purchase milestones.
Don’t Confuse Property Bridging Loans with the SME Temporary Bridging Loan
Policy-backed business programmes from 2020 were designed for companies, not homeowners. The SME Temporary Bridging Loan Programme (TBLP) ran until September 2022 and had distinct rules and protections.
SME Temporary Bridging Loan (TBL): what it was
The TBLP started in Budget 2020 to support businesses. From 1 April to 30 September 2022, interest rates were capped at 5.5% p.a.
- Up to five-year tenure and 70% government risk sharing.
- 19 participating banks and financial institutions during the programme window.
Why homeowner products differ
Property short-term facilities are consumer tools tied to sale proceeds and the completion timeline. They are typically brief and priced by market risk, not policy caps.
- Purpose: SME support = working capital; homeowner facilities = transaction timing.
- Terms: TBLP allowed multi-year amortisation; homeowner facilities run for a short period and repay at completion.
- Pricing: programme rates were capped; consumer products reflect bank underwriting and market conditions.
“Comparing a past government programme with today’s homeowner options is apples-to-oranges.”
If you’re moving house, focus on valuation, sale certainty and completion dates. For business financing, review current Enterprise Financing Scheme options.
Whatsapp us for a discovery session so we can guide you to the right product for your objective and avoid misalignment that delays approvals.
How to Compare Options and Lock In a Competitive Rate Today
Start with the facts lenders use to underwrite your file: borrower profile, sale certainty, and valuation support. Use those three points as your comparison pillars when you shortlist banks.
- Match structures: Capitalized vs Simultaneous and the expected drawdown and completion dates.
- Confirm early repayment flexibility and any minimum commitment period before you sign.
- Prefer banks known for fast credit turnarounds if your timeline is tight—speed often trumps a marginally lower quote.
- Bundle with your new mortgage where possible; packaging can unlock fee concessions or better pricing.
Negotiation anchors and service checks
Use firm OTP or signed S&P, strong buyer profile, and clear completion dates as negotiation anchors. Ask for a dedicated case manager and a written timeline to avoid last‑minute surprises.
| What to compare | Why it matters | Key question to ask | Desired answer |
|---|---|---|---|
| Structure (Capitalized/Simultaneous) | Impacts cash flow and final payout | How is interest handled during tenor? | Clear capitalization rules and sample payoff |
| Early repayment terms | Affects exit cost if sale completes early | Any minimum interest period or penalty? | Flexible early repayment, no hidden minimums |
| Approval speed & service | Determines confidence on tight timelines | Typical processing days and case manager? | Fast turnaround and named contact |
| Valuation assumptions | Drives required funding and gap size | Conservative floor used in valuation? | Transparent methodology and can revalue |
We’ll benchmark multiple banks, negotiate on your behalf, and present a clear recommendation matrix. Whatsapp us for a discovery session and we’ll lock in a competitive package aligned to your dates and documents.
Conclusion
, A short, well-timed facility can protect your cash and let you move into a new home with confidence.
Keep the borrowed amount tight, align completion dates, and secure clear valuation and sale evidence. This lowers the total days you carry the facility and helps reduce accrued interest and final rate exposure.
Decide early between Capitalized Interest and Simultaneous Repayment based on your monthly cash position. Clean credit and organised documents speed the application and improve how banks view your case.
Whatsapp us for a discovery session — we’ll model repayments, compare bridging loan options across banks, and right-size the loan so your move is smooth and controlled.
FAQ
What is a competitive bridging loan interest rate in Singapore?
A competitive bridging loan interest rate in Singapore is the price lenders charge for short-term finance that fills the gap between buying a new property and selling your existing one. Rates depend on lender policy, your credit profile, the property value, and the expected sale timeline. We recommend comparing offers from multiple banks and factoring in fees to judge true competitiveness.
What should Singapore homebuyers know before chasing rates?
Before you chase the lowest number, review your cash flow, sale certainty, and how the short-term financing affects your monthly commitments. Consider Loan-to-Value limits, any early repayment rules on your mortgage, and whether you can service two mortgages briefly. These factors often matter more than a marginally lower headline rate.
What is a bridging loan and why must it be paired with a new home loan?
A bridging loan is short-term financing that covers the purchase of a new property until you free up proceeds from selling your current home. Lenders usually require it to sit alongside the long-term mortgage for the new property so both the purchase and eventual repayment are properly secured and documented.
How does the short-term nature and repayment using sale proceeds work?
These facilities are typically issued for a few weeks up to six months. You draw on the credit to complete your purchase and then repay principal and accrued amounts when your existing property sells. If the sale delays, lenders may extend the facility at additional cost, so plan buffer time.
How can a bridging loan influence my Loan-to-Value (LTV) ratio?
A short-term advance affects the combined exposure lenders see. If you use proceeds as part of the down payment, your LTV on the new mortgage may be lower. Conversely, if the advance increases your outstanding secured borrowings, some lenders may adjust permissible LTV, impacting how much you can borrow long term.
What drives the rate for this short-term finance and how can I secure a better deal?
Key pricing drivers are lender perceived risk, the expected tenure (often up to six months), the certainty of your property sale, and the property type. To secure a better deal, present a strong sale contract, clear valuations, a solid credit record, and shop multiple banks. Timing your application close to contract completion also helps.
How do these rates compare to standard home loan interest charges?
Short-term bridging finance typically costs more than standard mortgages because of higher perceived risk and shorter tenor. However, if you only need the facility briefly, total cost may still be lower than alternative options like unsecured credit or selling at a discount to avoid overlap.
How do timing and property valuation impact the price I receive?
Lenders price according to the latest valuation and how soon they expect sale proceeds. A conservative valuation or long expected sale window raises the charge. A recent independent valuation and strong buyer commitments reduce perceived risk and can improve terms.
How should I compare rates across banks and what does “competitive” mean?
Compare effective cost, not just the headline figure. Look at the nominal charge, any capitalized interest, arrangement fees, legal and valuation fees, and early repayment conditions. A competitive deal balances a reasonable headline figure with low fees and flexible terms aligned to your timeline.
What are the main types of this short-term finance?
Two common structures are capitalized interest, where interest is added to the principal and paid on sale, and simultaneous repayment, where you service both the new mortgage and the short-term advance concurrently to reduce total interest outlay.
What is capitalized interest versus simultaneous repayment?
With capitalized interest you defer payments and roll them into the outstanding balance, simplifying cash flow but increasing total payable. Simultaneous repayment requires you to service both debts during the overlap, which raises monthly cost but can lower total interest because the advance reduces faster.
Who typically qualifies for these facilities in Singapore?
Eligibility usually depends on citizenship or residency, age, verified income, credit profile, and evidence you will sell your existing property (such as an Option to Purchase or signed sales & purchase agreement). Lenders assess overall repayment capacity and collateral quality.
What documents do I need when applying?
Prepare identity documents, proof of income (payslips or tax statements), the sales & purchase or Option to Purchase for both properties, and recent valuation or property title documents. Banks may also request bank statements and CPF details for mortgage assessment.
How does submission differ between HDB and private property cases?
HDB sales and eligibility rules add steps; you must meet HDB resale or new flat conditions and timelines. Private property submissions follow bank valuation and title checks. Working with a lender familiar with both streams speeds approval and reduces surprises.
What are the total costs beyond the headline charge?
Expect additional items: arrangement and legal fees, valuation costs, potential early repayment fees, and any capitalized interest if you defer payments. Factor these into your comparison to see true cost over the facility term.
How can I reduce the overall cost of this short-term finance?
Reduce LTV where possible, shorten tenure, provide a recent valuation and strong sale documentation, and negotiate fees. If you can service some interest during overlap, choose simultaneous repayment to lower capitalized expense.
What are typical processing timeframes and common delays?
Processing often takes a few business days to several weeks depending on documentation, valuations, and whether HDB approvals are required. Common delays include incomplete paperwork, slow buyer confirmations, and valuation scheduling. Early submission of documents speeds things up.
How should I plan cash flow and repayment from sale proceeds?
Prepare a priority plan: set aside transaction costs, confirm solicitor timelines, and agree repayment instruction with your lender so proceeds are applied promptly. Maintain a backup funding source (cash reserve or overdraft) if the sale slips.
Is a homeowner bridging facility the same as the SME Temporary Bridging Loan (TBL)?
No. The SME TBL was a business support program with capped terms and a window that closed in September 2022. Homeowner facilities are private, tailored for property transactions, and have different pricing, purpose, and eligibility rules.
Why do homeowner short-term products differ from the SME TBL?
Homeowner products focus on individual property transactions, use property as collateral, and are priced to reflect market risk and sale certainty. The SME program was a government-backed business relief effort with specific caps and timelines that do not apply to personal property finance.
How do I compare options and lock in a competitive arrangement today?
Benchmark offers across major banks, request a full cost schedule (fees plus effective charge), prioritize lenders experienced with your property type, and present a solid sale timeline and valuation. For tailored guidance, contact your lender or mortgage advisor to run side-by-side comparisons.
