A bridging loan covers the cash gap between buying a new condo (which needs deposit and down-payment immediately) and selling an existing HDB (which releases cash only at completion). Typical terms: 6-month tenor, interest-only repayment at 4-6% p.a., loan size up to 25% of new property value or full down-payment shortfall. Most major banks offer; processing 2-4 weeks.
Bridging loans solve the timing mismatch in HDB-to-condo upgrades: the condo OTP demands 5% on exercise (typical) plus 20% additional down-payment at completion (often 10-14 weeks later), while the HDB sale releases cash only at its own completion (also 10-14 weeks later). When timing slips, bridging covers the gap.
The loan is short-tenor (6 months typical, extendable to 12), interest-only, and is repaid from the HDB sale proceeds. Interest rates currently run 4-6% p.a. on a floating basis. Total interest cost on a S$300K bridge for 4 months is roughly S$5-6K — modest insurance against schedule slippage.
Three structural rules:
Loan size cap — Bridging loans are typically capped at 25% of the new property value or the actual cash shortfall, whichever is lower. Cannot exceed the buyer's expected proceeds from the existing property sale.
Eligibility tied to sale OTP — Most banks require the existing HDB to be at least under OTP (a buyer has committed) before disbursing bridging — to verify the source of repayment.
Interest-only structure — Monthly interest payments during the bridge; principal balloon repaid at HDB sale completion. Some banks offer rolled-up interest (added to principal at maturity) at premium rates.
Property upgrade paths are as much about timing and tax as they are about price. The wrong sequence can trigger ABSD on both properties simultaneously; the right sequence can defer stamp duty legally and preserve CPF usage. This guide walks through the key milestones, decision points, and common pitfalls, and links out to the calculators you will need to stress-test the numbers at each step.
Loading chart data...
What Is a Bridging Loan?
A bridging loan provides temporary financing to cover the gap between buying your new condo and receiving proceeds from selling your HDB. It's repaid once the HDB sale completes.
When You Need One
- Buying before selling (concurrent purchase strategy)
- HDB sale proceeds haven't been released yet
- Need to cover condo down payment before HDB completion
Bridging loan economics for typical HDB-to-condo upgrade:
| Item | Value | Notes |
|---|---|---|
| New condo price | S$1.5M | Resale, 25% down required |
| Down-payment required at completion | S$375,000 | 5% at OTP + 20% balance |
| Expected HDB net proceeds | S$280,000 | After loan, CPF refund, costs |
| Bridging loan size | S$280,000 | Cap at expected HDB proceeds |
| Tenor | 4 months | HDB completion timing |
| Interest rate | ~5% p.a. | Floating, 1-3M SORA + 1-2% |
| Total interest cost | ~S$4,700 | Cost of timing insurance |
| Arrangement fee | ~S$2,000-3,000 | One-time |
For a 4-month bridge, total cost typically S$7K-8K — modest compared to the alternatives of accepting a fire-sale price on the HDB or losing the condo OTP deposit.
Sources & methodology. Loan structuring per MAS lending guidelines; MAS Notice 645 (TDSR/MSR framework).
- Pre-arrange bridging capacity BEFORE condo OTP. Apply when you start looking; takes 2-4 weeks. Having the facility ready removes pressure on HDB sale negotiation.
- Confirm bridge size against actual HDB proceeds. Pull a CPF housing statement and current bank loan balance; bridging cannot exceed expected net proceeds.
- Negotiate interest rate. Shop 3+ banks; bridging is a credit product where rate spreads matter — 1pp difference on S$300K x 6 months = S$1,500.
- Time HDB completion carefully. Most bridges are 6-month tenor; if you need 9-12 months, expect higher rate. Build a buffer rather than relying on the bridge for unlimited extension.
Methodology & Sources
This analysis covers full-year 2026 data and refreshes one-time.
Transaction data sourced from URA REALIS.
Median values used to minimise outlier impact. PSF = price per square foot.
Frequently Asked Questions
What is the single biggest mistake in upgrading?
Should I sell first or buy first?
Can I keep my HDB as a rental while upgrading?
Can I get a bridging loan before signing the HDB sale OTP?
Most banks require the HDB to be under OTP (buyer committed) before disbursing. Some banks issue an Approval in Principle without OTP, conditioning final disbursement on signed HDB OTP.
What happens if my HDB sale falls through during the bridge?
You must repay the bridge from another source (savings, fresh sale, refinance into a longer-term loan). Banks may extend the tenor at penalty rate; falling-through-of-sale is the main risk in bridging.
Does the bridge count against my TDSR?
Yes. Bridging loan monthly interest counts toward TDSR (55% cap, stress-tested at 4%) for the duration. Combined with the new property mortgage, this can push high-leverage buyers over the limit; pre-check with your bank.