How to Finance Your Dream House

We all have our dream house – its look, appeal, style, design, color, component, etc. Unfortunately, not all of us have the money to invest in properties Philippines. Whether it is a condominium, apartment, single-attached or detached or bungalow type or be it in Amara, Montecito or Ayala Westgrove Heights, good thing we have so many options to finance a house and lot for sale Philippines.

1) Cash

Paying cash for any real estate property Philippines is the most secure mode of financing a dream house. There will be no monthly mortgage payments and title transfer restrictions due to home loans, and you and your family can immediately occupy the place perhaps even before the title transfer is finalized.

2) Deferred payment with or without interest

Paying in fixed portions as a way to settle the home loan is your second option. Payments are made on specified dates on a monthly basis. The interest rate will depend on the property itself and its value, the type of loan and the lender. When the tenure of the loan is longer, interest rate is applied. For instance, the owner-developer of the house and lot for sale Philippines e may require up to 9% interest rate for 10-year loan tenure. The real estate developer Philippines, on the other hand, may waive the interest rate for 2-year tenure. Interest rates generally vary from one real property developer Philippines to another.

3) Bank

Paying through banks is similar to paying for the house and lot in-house (directly to the owner-developer). The only difference is you need to have an active bank account on the banking institution that you wish your dream home to be acquired through. Some banks have their own list of Philippines properties including foreclosed properties that you may choose from. However, banks also process loans from various developers through an internal or outsourced broker. Banks typically require an interest rate from 5 to 9% per annum. Interest rates also vary from one banking institution to another. As of May 2014, the lowest interest rates are: PNB – 5.25%; BPI and HSBC – 5.5%; Allied Bank and PSBank – 6%; EastWest Bank – 7.5%; BDO – 7.75%; RSBC – 8% and Veterans – 8.25%.

4) Pag-Ibig

Paying through Pag-Ibig is the most affordable option probably because it offers the lowest interest rate at 4.5% per annum for home loans amounting to ?400,000 compared to developers and financial institutions. The interest rates depend on the income of the lendee and the total amount of home loan. For instance, Cluster 1 earners (individuals earning from ?15,000 to ?17,000 per month) may apply for a loan of up to ?750,000 at 6.5% per annum interest rate. Pag-Ibig, like banks, requires specific documents such as certificate of employment, source of income or bank statement.

Considerably, except for cash, you just have to prove to the developer, bank or Pag-Ibig that you have the capacity to pay for the property otherwise your home loan application will be disapproved. If you can, you may start saving money so you can buy a house and lot for sale Philippines. After all, investing on a property that you can call your own is always worth it.