As property prices continue to soar in Singapore, it’s no surprise that more and more clients are struggling to secure financing for their dream homes. The TDSR framework, which was introduced in 2013, places a limit on the amount of debt a borrower can take on based on their income and other financial commitments. This is great for promoting financial prudence, but it can be a real headache for asset-rich, cash-poor clients who can’t seem to meet the TDSR requirements.

Enter bridging loans – the knight in shining armor for those who are struggling to secure traditional long-term mortgages. Bridging loans are short-term financing options that can be used to bridge the gap between the purchase of a new property and the sale of an existing one. But they aren’t just for real estate – bridging loans can also be used for a variety of temporary financial needs, from repaying an expensive loan to investing in a promising company.

The beauty of bridging loans lies in their flexibility. Unlike traditional mortgages, they aren’t subject to the same TDSR requirements. This means that clients can secure the financing they need without having to worry about how their debt servicing ratio stacks up. Plus, bridging loans are typically much quicker to obtain than traditional mortgages, making them a great option for those who need to act fast.

But, as with any financial product, there are risks involved. Bridging loans typically come with higher interest rates than traditional mortgages, so clients need to be aware of the cost of borrowing. And if the sale of the existing property falls through or is delayed, clients may find themselves in hot water if they can’t repay the loan in time.

Despite the risks, bridging loans remain a valuable financing option for those who need a little extra cash to bridge the gap between their financial needs. For clients and corporates who are asset-rich but liquidity-constrained, bridging loans provide a flexible, efficient way to secure financing without worrying about the TDSR requirements.

So if you’re struggling to secure financing for your dream home, consider exploring the world of bridging loans. It may just be the solution you’ve been searching for! Contact us today to learn more about how bridging loans can help you bridge the gap between your temporary financial needs and secure your financial opportunities.