Bridging the Gap: Quick liquidity solutions through global real estate
Accessing your global real estate equity for cash
For many years, sophisticated real estate investors have used a tool called real estate bridging loans to grow their wealth. In 2019, Global Mortgage Group (GMG), a Singapore-based real estate financing firm, introduced these “bridging” loans to the Singapore market. Since then, GMG has earned numerous industry awards and is now recognised as a global leader in real estate bridging loans.
What is a real estate bridging loan?
Unlike conventional mortgages, which are often based on the borrower’s income or the cash flow of a property, bridging loans are secured primarily by the value of the property itself. This means that the borrower’s ability to service the debt in a “traditional” manner is normally not a factor when qualifying for this type of loan.
Originally used mostly by the wealthy, real estate bridging loans are now available to a wider range of people. These loans can be used to either purchase a property or release equity from the value of an existing one. They are typically processed much faster than traditional mortgages, often closing in under a week with minimal paperwork – offering a quick, stress-free way to access cash when it’s needed most.
In 2023, GMG funded $400 million in bridging loans in Singapore alone. Another $200 million have been funded in the year-to-date in 2024. Globally, the company has provided nearly $100 million in real estate equity loans in the US this year.
GMG currently offers real estate bridging loans in the US, Canada, the UK, Singapore, Hong Kong, Australia, Thailand and the Philippines.
A recent example
A Singapore entrepreneur needed $5 million to expand his business quickly. He owned a home worth $10 million with a $1 million mortgage. GMG arranged an $8 million loan (80% of his home’s value), with $1 million paying off his mortgage and the remaining going toward his business expansion.
The loan was structured so the entrepreneur didn’t have to make any monthly payments for the first 12 months. This allowed him to focus on his business without worrying about immediate cash flow. The loan was also designed to be short-term, with the plan to repay it once the entrepreneur sold his property at the right price.
The best part? The entire process – from applying for the loan to receiving the funds – took only a few weeks.
Repayment terms: pay the principal at the end
Most bridging loans are structured so the borrower only pays interest during the loan term. The principal, or the full amount of the loan, is paid in a lump sum at the end. Many borrowers repay the loan by selling the property.
Common uses for bridging loans
Bridging loans are popular because they can be used in many creative ways, such as:
- Personal investments
- Paying off existing debt
- Company working capital
- Emergency expenses
- Renovations
- Release of equity before selling a property
No TDSR requirement or age restrictions
Since these bridging loans are arranged between private lenders and the borrower, there’s no need to meet a bank’s Total Debt Servicing Ratio (TDSR) requirements, which is a big advantage.
In many countries, like Singapore, banks impose age limits on those who can qualify for a loan. However, with asset-backed bridging loans, there are no maximum age restrictions. This makes them more accessible to a wider range of people.
About Global Mortgage Group
Global Mortgage Group (GMG) was created to offer international real estate financing solutions for a global clientele, including overseas expats, foreign nationals, family offices, investment funds, high-net-worth clients and private banks.
With a network of 300 direct lenders worldwide, GMG has an unmatched ability to offer creative and unique funding solutions. While many mortgage brokers simply connect clients with a bank and charge a fee, GMG’s team of professional bankers takes the time to fully understand each client’s needs and structure tailored solutions – not just mortgages.
GMG’s global reach includes offices in Singapore, Hong Kong, Shanghai, Manila, Bangkok, Seoul, Sydney, London, Panama, Toronto, and the US.
For more information on bridging loans for real estate equity, visit gmg.asia or call 9773 0273.
Written in collaboration with the Global Mortgage Group
