Caveat-backed Working Capital Loan

Understanding Caveat Loans

Caveat-backed working capital loan also known as a caveat business loan is a type of secured loan that allows business owners to use their property as collateral to obtain financing of a business loan. Residential, commercial and industrial properties all can be qualified to use as collateral when taking up the loan.

Our caveat loan allows you next-day access to cash and can be applied on properties that already have an existing mortgage. It is not subject to TDSR and LTV limits and comes with low interest rates, flexible repayment terms, and quick approvals.

Our caveat loan products are underwritten and disbursed by TBS Capital, a subsidiary of Tembusu Financial Services.

Caveat-backed working capital loans offer a unique financing solution for businesses in Singapore, providing a host of benefits tailored to meet the demands of a fast-paced market environment. These loans leverage the equity in a company's property as collateral, allowing businesses to access significant funds quickly and with minimal hassle. Here are some key advantages:

Quick Access to Funds: Caveat-backed loans are designed for rapid processing, providing businesses with next-day access to capital. This speed is invaluable for companies needing immediate liquidity to seize growth opportunities or address urgent financial needs.

High Loan-to-Value (LTV) Ratios: Offering up to 80% LTV financing, caveat-backed loans enable businesses to maximize the value of their property assets. This high LTV ratio provides a substantial capital base to support various business activities, from expansion to inventory management.

Flexible Repayment Terms: Understanding the variable nature of business revenues, caveat-backed loans come with flexible repayment options. This adaptability helps businesses manage their cash flow more effectively, aligning loan obligations with their financial cycle.

Bypass Traditional Lending Restrictions: Unlike traditional loans, caveat-backed working capital loans are not bound by stringent Total Debt Servicing Ratio (TDSR) and Loan-to-Value (LTV) limits. This flexibility makes them an accessible option for businesses that may not qualify for conventional financing due to current regulations or financial standings.

In addition to caveat loans, Tembusu Financial Services is proud to introduce our bridging loan solutions, designed to meet the immediate financial needs of businesses awaiting the sale or completion of their property transactions. Bridging loans act as short term loans to bridge the gap between needing funds now and securing permanent financing or incoming capital later.

Bridging loans serve as a pivotal financial tool in Singapore for those transitioning between selling one property and purchasing another, offering a solution to immediate liquidity needs. These loans come in two main types: capitalised interest and simultaneous repayment, each with distinct repayment structures and interest calculation methods, making it essential for borrowers to understand their differences to choose the most suitable option. Moreover, due to their short-term nature, the higher interest rates and associated fees of bridging loans necessitate careful comparison and consideration to ensure affordability and alignment with one's business financial planning.

Capitalised Interest Bridging Loan: With this type of loan, the entire cost of your new property is covered by the bridging loan. Loan payments won’t start until your old property is sold. This means you don’t have to worry about making a down payment and mortgage payments simultaneously.

If you don’t want to juggle two loans at the same time, this is an ideal bridging loan option. However, be aware that high interest rates and longer selling times can make repayments challenging. Therefore, it’s essential to carefully weigh the pros and cons before choosing this financing method.

Simultaneous Repayment Bridging Loan: This bridging loan requires you to repay your property loan simultaneously with the bridging loan. Managing both payments can be tedious and stressful. However, if you aim to pay less interest on your bridging loan, this can be a good option.

*Simply reach out to us directly at 67412588 drop us a WhatsApp message. Our dedicated loan specialists will walk you through the seamless application process, ensuring you get the support you need for your business ventures.