The Bridging Loan Singapore is the solution available to homeowners who wish to acquire a property pending finalization of the sale of another possession. The ideal is the coincidence between the conclusion of the transfer of a current property and the purchase of a new one, in order to finance the future acquisition. This is not always the case however, not to say that it is quite rare. This is where the bridging loan singapore comes in.
Relay loan in practice
If the sale of real estate can take time to avoid scams or significant losses, the purchase requires some reactivity. This makes it almost impossible to plan a new financial acquisition with funds raised from the sale of a current property. The loan relays then part of the emergency doors offered by banks. It’s a very simple definition of a short-term loan. Its purpose will be to fill part of the value of the property to be acquired. This amount will be fixed according to the price of the property for sale. This amount will allow the borrower to purchase his new home directly. When the sale of the current property will be made, he must repay immediately and in full the loan acquired. The advantage of this bridging loan singapore is the deferred repayment. This means that the owner will only be required to repay the loan when he has managed to sell a previous property. He will also have to pay no penalty.
The different types of bridging loan singapore
There are three types of bridging loan singapore:
– We have the loan relay dry: in this case, the borrower will have taken out a bridging loan singapore only to the bank without any other type of mortgage. The sale price of a current property will therefore be able to cover the full repayment of the loan or the borrower has already finished honouring his old commitments to his bank.
– The integrated bridging loan singapore is defined as a long-term, general loan including a mortgage in addition to the bridging loan. For this type of loan, a clause must be inserted in the contract exempting the borrower from the payment of penalties normally incurred in the event that the repayment of the loan was made prior to the sale of an old acquisition.
– Finally, the most usual form is the relay loan associated or backed by a previous credit. This option requires the borrower to combine their current home loan with the bridging loan singapore. While waiting for the sale of the old property, he will have to pay the interest on his new loan as well as the commitments agreed in his previous mortgage. In the event that the sale of the current property is concluded, he will repay the bridge loan and will only have the monthly payments of his principal loan to pay.