Answer
Bridging Loan for Property in Singapore
Buying before selling? A bridging loan fills the cash gap — but it comes at a cost. Here's what you need to know.
Answer: A bridging loan is a short-term loan (6–12 months) at 5–6% p.a. interest, covering up to 25% of your existing property's value. It bridges the gap between buying your new home and selling your current one. Subject to TDSR.
Bridging Loan at a Glance
| Feature | Details |
|---|---|
| Interest rate | 5–6% p.a. |
| Loan tenure | 6–12 months |
| Max loan amount | Up to 25% of existing property value |
| TDSR applicable? | Yes — counts as existing debt |
| Available for HDB? | No — private property only |
| Banks offering | DBS, OCBC, UOB, Standard Chartered |
When Do You Need a Bridging Loan?
Buying before selling — you've found your next home but haven't sold your current one yet. You need cash for the down payment and completion.
New launch purchase — you've booked a new-launch condo and need to pay the progressive payments while still owning your existing property.
Timing mismatch — your sale is confirmed but completion dates don't align. You need short-term funds to bridge the gap.
Cost Example
Let's say you need a $300,000 bridging loan at 5.5% p.a. for 6 months:
| Item | Amount |
|---|---|
| Bridging loan | $300,000 |
| Interest (5.5% p.a. x 6 months) | ~$8,250 |
| Processing fee (typical 1%) | ~$3,000 |
| Total cost of bridging | ~$11,250 |
This is $11K+ just for the convenience of buying before selling. Worth it? Depends on your situation.
Buy First vs Sell First
| Strategy | Pros | Cons |
|---|---|---|
| Buy first (bridging loan) | Secure the property you want. No temp housing needed. | Higher cost (5–6% interest). ABSD if 2nd property. TDSR pressure. |
| Sell first, rent, then buy | No ABSD. Full LTV. No bridging cost. Less financial stress. | Need temporary housing. May miss out on preferred unit. Two moves. |
For most upgraders, selling first is the safer and cheaper option. Bridging loans make sense only when the timing or the unit is critical.
TDSR Impact
The bridging loan monthly payment counts as existing debt under TDSR. This means your total monthly debt obligations (existing mortgage + bridging loan + new mortgage + car loan + credit cards) cannot exceed 55% of your gross monthly income.
With two mortgages and a bridging loan running simultaneously, you need a significantly higher income to pass TDSR. Run your numbers carefully before committing.
Check your borrowing capacity
See if your income supports a bridging loan on top of your new mortgage. Run TDSR first.
FAQ
What is a bridging loan in Singapore?
A bridging loan is a short-term loan that covers the gap when you buy a new property before selling your existing one. It gives you the funds needed for the down payment and completion of the new purchase while you wait for sale proceeds from your existing property.
How much can I borrow with a bridging loan?
Typically up to 25% of your existing property's value or the net sale price (whichever is lower). Some banks may offer up to the full equity of the property being sold. The exact amount depends on the bank and your financial profile.
What interest rate do bridging loans charge?
Bridging loan interest rates are typically 5–6% per annum — significantly higher than regular mortgage rates (2.5–3.5%). This is because they are short-term, higher-risk loans. Interest is usually calculated on a monthly rest basis.
Can I get a bridging loan for an HDB purchase?
No. Bridging loans are not available for HDB purchases. They are only offered for private property transactions. If you're doing an HDB-to-HDB move, look into the HDB Contra Facility instead, which lets you link your sale and purchase proceeds.
Does a bridging loan affect my TDSR?
Yes. The bridging loan repayment counts as an existing debt obligation under TDSR calculations. This means it reduces your borrowing capacity for the new property's mortgage. Banks will stress-test both the bridging loan and the new mortgage against the 55% TDSR limit.
Related
- Sell HDB Buy Condo Timeline — ~9 months sell-first approach
- HDB Contra Facility — direct proceeds transfer for HDB-to-HDB
- Down Payment for First Condo — 25% (5% cash + 20% CPF)
- Property Loan Interest Rates 2026 — 2.65–2.80% fixed
- Should You Upgrade HDB to Condo? — full decision guide
Last updated Feb 2026. Rates and limits are indicative — check with your bank for exact terms. This is informational, not financial advice.