What is the typical loan amount and interest rate for LRD?

The loan amount and interest rate for Lease Rental Discounting (LRD) generally depend on various factors, such as the property’s value, rental income, and the loan provider's policies.

Typical Loan Amount

• Loan providers provide loans up to 80% of the leased property's market value. The percentage depends on property details and an applicant’s financial credibility.
• The loan amount is calculated based on the discounted value of the property's expected future rental income over the lease period.
• Longer lease terms generally result in higher loan eligibility, thanks to more consistent rental income.

Typical Interest Rates

• LRD loans are secured by the property and rental income. So, interest rates are lower than unsecured loans.
• Interest rates usually start at 8% and increase from there. The exact rate depends on the loan provider, an applicant's creditworthiness, and financial market conditions.
• Loans with longer repayment tenures may have slightly higher interest rates to account for the extended time period.