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Bank Financing 101
Most home buyers here in the Philippines cannot afford to pay off the property in cold cash. Imagine buying a condominium worth P2.4Million pesos and paying it all in one time. It would be too difficult! Only few individuals can afford to do this and even those people with enough money would like to leverage and extend the terms so that they can use their money somewhere else (like business and other investments).
This is the reason why housing loans and financing options are available to public in order for the people to own a house without having to shell out its total amount. This is one reason why real estate is a really good investment. There are properties out in the market that you can already move-in for as low as 5% of its total contract price! Such great leverage that you can already use the property with just a small amount of cash out.
While most of the Filipino employees are members of the Home Development Mutual Fund (HDMF), not all properties can be financed thru Pag-IBIG Financing. One can only borrow up to a maximum of P3Million using this fund. In our personal opinion at DRIVEN Marketing Group, a buyer who intends to borrow P2Million and more for a housing loan can already consider going thru Bank Financing since the interest rate for Pag-IBIG Housing Loan is already at 11.5% per year for loans P2,000,001-P3,000,000. This means that the bank interest rates are almost the same (some banks might offer lower interest rates) with Pag-IBIG Financing interest rates for this loan bracket.
Because of the growing need for housing loans, most buyers are considering to get a loan from a bank to finance their homes. Here we share the basic information that you need to know with regarding to Bank Financing Options.
The Bank of the Philippine Islands (BPI) launched a program to cater this need.
This is the reason why housing loans and financing options are available to public in order for the people to own a house without having to shell out its total amount. This is one reason why real estate is a really good investment. There are properties out in the market that you can already move-in for as low as 5% of its total contract price! Such great leverage that you can already use the property with just a small amount of cash out.
While most of the Filipino employees are members of the Home Development Mutual Fund (HDMF), not all properties can be financed thru Pag-IBIG Financing. One can only borrow up to a maximum of P3Million using this fund. In our personal opinion at DRIVEN Marketing Group, a buyer who intends to borrow P2Million and more for a housing loan can already consider going thru Bank Financing since the interest rate for Pag-IBIG Housing Loan is already at 11.5% per year for loans P2,000,001-P3,000,000. This means that the bank interest rates are almost the same (some banks might offer lower interest rates) with Pag-IBIG Financing interest rates for this loan bracket.
Because of the growing need for housing loans, most buyers are considering to get a loan from a bank to finance their homes. Here we share the basic information that you need to know with regarding to Bank Financing Options.
The Bank of the Philippine Islands (BPI) launched a program to cater this need.
Housing Loan
Am I qualified to avail of a Housing Loan thru a bank?
Product Features
Qualified Applicant:Filipino, of legal age but not more than 65 years old upon maturity of the loan. Foreign nationals married to Filipinos should execute an Affidavit of Support and Waiver of Rights over the collateral property.
Loan Amount:Minimum of P400,000Maximum of 70% of appraised value of vacant lot, house & lot, townhouse and residential condominium 80% of appraised value of house & lot not to exceed P5M (provided applicant is employed and purpose is for owner occupancy)
Loan Term:Maximum of 25 years for house & lot and townhouse10 years for vacant lot and residential condominium10 years for refinancing and multi-purpose loan5 years for business loan
Interest Rate:Fixed interest rates for 1, 2, 3, 5, 6 to 25 years
Collateral:Registered first real estate mortgage
Gross Monthly Income:Minimum of P40,000
Repayment Mode:Equal monthly amortization of principal & interest
Payment Option:Automatic debit arrangement (ADA) with any BPI or BPI Family Savings Bank Branch
Manner of Loan Release:Lump sum and staggered release for construction purposes
Processing Period:5 days credit decision for loan amounts below P5M
What are the usual interest rates of a bank?
HOUSING LOAN
Interest Rates
Yearly 8.75%
2-3 years 9.75%
4-5 years 10%
6-10 years 11%
11-15 years 11.25%
16-20 years 11.50%
What are the requirements I need to provide?
Checklist of Requirements
A. Pre-processing Requirements
B. Income Documents
If locally employed
If Expat Pinoy (Overseas Filipino Worker)
If Self-Employed
If Practicing Doctor
If from Commission
If from Rental of Properties
C. Collateral Documents
For Construction Loan
Refinancing of Loan
D. Fees
Non-refundable appraisal fee of P3,000
Post Approval Requirements
Fees
Am I qualified to avail of a Housing Loan thru a bank?
Product Features
Qualified Applicant:Filipino, of legal age but not more than 65 years old upon maturity of the loan. Foreign nationals married to Filipinos should execute an Affidavit of Support and Waiver of Rights over the collateral property.
Loan Amount:Minimum of P400,000Maximum of 70% of appraised value of vacant lot, house & lot, townhouse and residential condominium 80% of appraised value of house & lot not to exceed P5M (provided applicant is employed and purpose is for owner occupancy)
Loan Term:Maximum of 25 years for house & lot and townhouse10 years for vacant lot and residential condominium10 years for refinancing and multi-purpose loan5 years for business loan
Interest Rate:Fixed interest rates for 1, 2, 3, 5, 6 to 25 years
Collateral:Registered first real estate mortgage
Gross Monthly Income:Minimum of P40,000
Repayment Mode:Equal monthly amortization of principal & interest
Payment Option:Automatic debit arrangement (ADA) with any BPI or BPI Family Savings Bank Branch
Manner of Loan Release:Lump sum and staggered release for construction purposes
Processing Period:5 days credit decision for loan amounts below P5M
What are the usual interest rates of a bank?
HOUSING LOAN
Interest Rates
Yearly 8.75%
2-3 years 9.75%
4-5 years 10%
6-10 years 11%
11-15 years 11.25%
16-20 years 11.50%
What are the requirements I need to provide?
Checklist of Requirements
A. Pre-processing Requirements
B. Income Documents
If locally employed
If Expat Pinoy (Overseas Filipino Worker)
If Self-Employed
If Practicing Doctor
If from Commission
If from Rental of Properties
C. Collateral Documents
For Construction Loan
Refinancing of Loan
D. Fees
Non-refundable appraisal fee of P3,000
Post Approval Requirements
Fees
Thanks to different financing institutions like BPI, home buyers can now own their dream house without paying off in cold cash!
