When it comes to buying a new property, it’s common to experience a financing gap where you need to sell your existing house before acquiring the new one. Bridging loans are an ideal way to fund your property acquisition without putting your plans on hold while waiting for the sale of your current home. It is a short-term financing option that can bridge the gap between buying a new property and selling your existing one. In Singapore, bridging loans have become a popular option among property buyers, and in this article, we will look into Bridging Loan Singapore as a financing option for property acquisition.
What is a Bridging Loan?
Bridging loans are short-term financing options that property buyers can use to purchase a new property while waiting for the sale of their current property. It is a flexible financing option that can help you secure a new property without any worries of a delay. The loan amount is determined by the value of the property and the end date of the loan is set to the expected sale date of the current property.
Benefits of Bridging Loan Singapore
One of the significant benefits of a bridging loan is the flexibility it offers, allowing for a quick acquisition of a new property. As there is a lot of competition and an increase in property prices in Singapore, it is essential to have a fast funding option for property acquisition. A bridging loan enables you to secure a property while selling your existing one, ensuring that you are not left without a place to live in while waiting for your new home.
Types of Bridging Loans
Bridging loans come in two forms – open-ended and closed-end bridging loans. Closed-ended bridging loans have a fixed repayment date, while open-ended bridging loans do not. The latter is suitable for property buyers who have not yet secured a buyer for their current property, while the former is ideal for those who know the expected sale date of their existing property.
How to Qualify for a Bridging Loan
To qualify for a bridging loan, you must provide evidence that you have a definite sale date of your current property. The loan amount you are eligible for depends on the value of the property you intend to buy and your current property’s expected selling price. You should also show proof of a regular income source to cover the interest rates and loan repayments.
In conclusion, Bridging Loan Singapore is an excellent and flexible financing option for property acquisition. If you are a property buyer or investor, a bridging loan can help you secure a new property without delays, even if the sale of your existing property is still pending. With flexible repayment options, Bridging Loans Singapore offers an ideal solution for those needing quick funding for their property acquisitions. At OT Credit, our team of financial advisors can help you navigate the complex world of bridging loans and help you secure the best deal possible.