What Are Your Options For Home Loans In The Philippines?
There are 2 types of housing loans available to borrowers in the Philippines;
- Conventional Housing Loans and
- Flexible Home Loans
Most of the Filipino borrowers planning to finance their dream homes go for conventional housing loans. This type of loan requires a borrower to pay back the amount borrowed together with an interest for a particular loan term. The borrower can choose between fixed or variable interest rates. These interest rates are influenced by a lot of factors like BSP (Bangko Sentral ng Pilipinas) key rates, inflation and supply and demand.
Flexible housing loans on the other hand provide flexible payment schemes. This type of loan is normally tied to a current account. With this type of account a borrower doesn’t have to worry about missing a payment due date since the loan is linked to his current account and the monthly loan instalment will be automatically deducted from the linked account.
Planning to refinance or renovate your home on a tight budget won’t be too difficult in the Philippines because there are plenty of options available. For example, HSBC offer home loans with flexible repayment terms. The minimum amount that you can borrow is P700,000. Repayment schemes of monthly and fortnights are also available. BDO (Bangko de Oro) Super Value Home Loan Program provide borrowers with an option to lock their interest rates for up to 5 years. Landbank of the Philippines also offer housing loans that can be paid up to a maximum of twenty years. Borrowers can also opt for a ten year fixed rate repayment term.
Here are your other options if you are planning to apply for a home loan in the Philippines:
SSS Home Loan – An SSS (Social Security System of the Philippines) member or an OFW (Overseas Filipino Worker) not older than 65 years old can qualify for this type of loan provided he has contributed for the past twelve months without missing a single payment. SSS provides socialized housing loans at P300, 000 and low-cost housing loans between P500, 000 to P1, 000,000. This type of loan has a repayment term of 5-30 years with an interest of 9%-14% per annum depending on the amount of the loan granted to the recipient.
PAG-IBIG Overseas Program – This is a savings program that provides an OFW with funds for future home financing. To qualify for a bigger loan amount you need to make a monthly contribution of at least P750. The borrower also has the option to withdraw his contribution after 5, 10, 15 or 20 years. By being a PAG-IBIG member you will be entitled to apply for housing loans, multi-purpose loans and dividends.
There are many alternative housing loan options in the Philippines, make sure you explore all your options and understand loan’s terms and conditions before signing an agreement.