Bank vs Private Bridging Loans in Singapore: Which Do You Need?

When a bank bridging loan is the right choice

If you are selling one home and buying another, the sale is confirmed with an OTP exercised, the amount you need is within the sale proceeds, and your income comfortably clears the Total Debt Servicing Ratio assessment, a bank bridging loan is usually the right product. The interest rate is lower than any private facility, the product is standardised, and it sits neatly alongside the new mortgage you are likely taking from the same bank.

We say this plainly because bridging finance works best when the tool matches the job. A significant share of enquiries we receive are better served by their own bank, and we tell them so.

What banks offer

DBS, UOB and OCBC each offer bridging loans as part of their home financing range. The common shape, as published on their product pages:

• The loan bridges the gap between the purchase of your new property and the completion of the sale of your existing one.
• The amount is tied to the net proceeds of the confirmed sale.
• The tenure is short, typically capped at around six months.
• Approval follows the bank's standard credit process, including the 55% TDSR income assessment that MAS requires banks to apply.

For a standard residential upgrade with a clean sale, that product does exactly what it needs to do.

When private bridging fits

Private bridging exists for the transactions that fall outside the standardised box:

• No confirmed sale yet. You are buying first and selling after, or your exit is a refinance or another liquidity event rather than a sale.
• TDSR does not tell your story. Asset-rich borrowers with modest declared income fail the 55% test regardless of their net worth. A private lender underwrites the asset and the exit instead of the payslip.
• The quantum is large. Facilities from S$1M to S$50M and above, beyond the sale-proceeds cap of a standard bridging product.
• The borrower is not a salaried individual. Companies, trusts and foreign owners of Singapore property are all fundable privately.
• The asset is not a standard home. Commercial property, shophouses, GCBs, land and auction purchases with fixed completion deadlines.
• The clock is the constraint. Indicative terms within 24 hours and funds in about two weeks, because credit decisions are made in-house by a direct lender.

Rates start from 0.4% per month, priced on loan-to-value, asset quality and exit certainty. The full mechanics are in our complete guide to bridging loans in Singapore.

Side-by-side: the six dividing lines

Speed to funds

• Bank: follows the bank's standard mortgage credit and legal process.
• Private: indicative terms in 24 hours; drawdown in about two weeks.

Loan size

• Bank: capped at the net proceeds of your confirmed sale.
• Private: S$1M to S$50M+, sized on the security property's value at up to 70% LTV.

Income assessment

• Bank: 55% TDSR applies to your declared income, as MAS requires.
• Private: underwriting is on the asset and the exit; income documentation is not the gating factor.

Who can borrow

• Bank: individuals within the bank's retail lending criteria.
• Private: individuals, companies, trusts and foreign owners.

Property types

• Bank: residential property in a standard sale-and-purchase chain.
• Private: residential, commercial, landed including GCB, shophouses and land.

Interest and repayment

• Bank: interest serviced monthly at bank rates; principal cleared from sale proceeds.
• Private: from 0.4% per month, serviced monthly or fully rolled up with zero monthly servicing until exit.

Five questions to ask before choosing

1. Is my sale already confirmed, with exercised OTP and a completion date?
2. Does the amount I need fit within my confirmed sale proceeds?
3. Do I clear the 55% TDSR test on declared income alone?
4. Am I borrowing as an individual against a standard residential property?
5. Does the bank's processing timeline fit my completion deadline?

Five yes answers: take the bank bridging loan. Any no: a private facility is built for your situation, and indicative terms cost nothing to request. Our five-step process shows exactly what happens after that first conversation.