Case Study · Singapore

Bridge loan for property investor to buy distressed asset

4 September 2018

Bridge loan for property investor to buy distressed asset

A property investor was in a bind when they found a great opportunity to purchase an apartment in Orchard Road through an auction. The price was well below market value, but their bank loan application was still in the approval process. They needed an urgent bridge loan to complete the purchase.

Feeling stressed and uncertain, the investor came across Rikvin Capital and reached out for help. Within 7 days, Rikvin Capital provided a $6,300,000 bridge loan, allowing the investor to successfully complete the transaction and acquire the prime property at a significant discount.

This experience taught the investor the value of having a reliable financial partner who could provide quick and effective solutions in times of need. They were grateful for the support and guidance they received and were now looking forward to reaping the benefits of their smart investment.

Problem

  • The property investor had purchased an apartment in Orchard Road through an auction.
  • The property was for sale at a price that was well below the market value.
  • The individual needed an urgent bridge loan to complete the purchase of the property while waiting for a bank loan to be approved.

Solution

  • Rikvin Capital provided a $6,300,000 bridge loan within 7 days.
  • The loan allowed the property investor to successfully complete the transaction and acquire a prime property at a significant discount.
  • Location: Orchard Road, Singapore
  • Market Value: S$ 9,000,000
  • Loan Amount: S$ 6,300,000
  • Loan-to-Value: 70%
  • Duration of Loan: 12 Months
  • Payment Schedule: Monthly Interest Payments
  • Asset Type: Condominium
  • Completion Time: 7 Days

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FAQ

I won a property at auction. Can you fund my completion?

Yes. Auction completions are one of our core deal types. We can issue a term sheet within 24 hours and release funds in 7 to 10 days for clean cases, well inside the usual 8 to 12 week completion window. The Orchard Road borrower in this case received $6.3 million in 7 days.

How much can I borrow against a property bought at auction?

We lend up to 70% of the lower of the auction price or an independent valuation. Auction discounts often work in your favour: the Orchard Road buyer borrowed 70% of price, but a much smaller share of the $9 million market value, which is a safer position for both sides.

I am waiting for bank approval. Can I use a bridge loan to complete now and switch later?

Yes. Bridge-to-bank is one of our most common setups. We fund the auction completion immediately, then you repay us when your bank loan comes through, usually 6 to 12 months later. You do not lose the auction or your 10% deposit while waiting on the bank.

Can I get pre-approved before I bid at an auction?

Yes, and we recommend it. We issue an indicative term sheet based on your profile and the catalogue properties you are targeting. The pre-approval is valid for 30 to 60 days and removes the financing risk so you can bid with confidence on auction day.