Eligibility is generally open to individuals or companies that own or are purchasing a shophouse, as long as they can provide the property as collateral. One advantage here is that foreigners are allowed to purchase commercial shophouses (unlike landed residential houses), so both local and foreign investors could potentially use shophouse bridging loans. Lenders will typically require the borrower to be an Accredited Investor if it’s a private bridging facility . Since many shophouse buyers are investors or SMEs, the borrowing entity might be a company – lenders do lend to corporate entities for bridging, provided the shophouse is either under the company’s name or will be, and the guarantors/directors qualify. The key eligibility factors are the property’s value and the borrower’s exit strategy (for repayment), rather than personal income. So even if you are self-employed or your company has limited financial history, you could still obtain a bridging loan if the shophouse asset is strong and there’s a clear plan to repay (like refinancing with a commercial mortgage or selling another property).

In Singapore, attractive shophouses – especially those in prime areas or with historical value – can be highly sought after, and deals often need to be closed quickly. A bridging loan gives you the liquidity to complete the purchase fast, without waiting for lengthy bank loan approvals or trying to liquidate other assets hastily. For example, if a shophouse is up for auction or a private sale that requires completion in a few weeks, a bridge lender can fund the bulk of the price, allowing you to meet the deadline . Additionally, bridging loans can cover the initial 10% deposit requirement if needed, which is useful in auctions where that deposit is due immediately . By securing the shophouse with bridging finance, you can then take your time to arrange a more permanent loan or structure (often commercial property loans take longer and might require tenancy agreements, etc.). In summary, bridging finance ensures you don’t miss out on acquiring the shophouse due to timing constraints, and it lets you capitalize on the opportunity while sorting out long-term funding later.

They are similar in nature, generally in the range of 0.5% to 1% per month (which is ~6-12% per annum) for private bridge financing. Because shophouses are commercial assets, some lenders might price a bit for perceived higher risk or illiquidity – but in Singapore, conservation shophouses in good locations are considered solid collateral, so rates are often comparable to residential bridging loans. If anything, the difference may come in the loan-to-value allowed rather than the monthly rate. Banks typically charge ~5-6% p.a. if they do a short-term bridging loan, but banks seldom have specific bridging products for shophouse purchases (they would just offer a normal commercial property loan, which can take time). With private lenders, you can expect interest-only payments on the bridging loan. For example, if you borrow S$2 million at 0.8% per month, you’d pay around S$16,000 per month in interest until you refinance or repay the principal. There might also be a one-time admin or legal fee. It’s critical to budget these interest costs into your shophouse investment plan, as they will eat into the rental yield or profit until you exit the bridge loan.

Yes, absolutely. Many clients use existing properties like shophouses to raise short-term funds. If you own a shophouse (whether fully paid or with substantial equity in it), you can take a bridging loan against it to free up capital. The use of funds can be for anything – some use it to purchase another property, some to inject into a business, or to cover an urgent expense while waiting for a sale. The lender will evaluate your shophouse’s current market value and any outstanding loans on it to determine how much they can lend. For example, if your shophouse is worth S$5 million and you have no mortgage, you might borrow, say, S$3.5 million short-term and later refinance with a bank or sell a property to pay it back. If you do have a mortgage, the bridging loan could be used to refinance that loan (essentially replacing it) or sit as a second charge if the lender is willing and there’s enough equity (though second charge positions usually come with lower LTV). Using an existing shophouse as collateral is a way to access its value without an outright sale – bridging loans are one of the few financing methods that can do this quickly without the usual income checks.