Most people are focusing on finding their dream house without knowing how much they can afford. They don’t even know how much will be the monthly payment their salary can accommodate.
Applying a home loan in the Philippines is complicated but it is possible if you will know the easy way for your loan application.
Here are some tips when applying home loan:
- Pre qualified
First step is to know your financial capacity for home loan. During the process of prequalified, the bank will ask your assets, monthly income, liabilities and projected down payment. The mortgage officer will tell you if you are prequalify and discuss you options. Being prequalify does not mean that you are pre-approved for home loan. This step is let know how much will be able to borrow.
- Pre approved
During pre approved process, the loan officer or mortgage officer will required you to submit proof of income, employment certification, recent bank statements, latest income tax returns, and other related documents so that the bank may know if you have sufficient income to pay off for a home loan.
- Housing Loan options
Know the housing options that best suited to your needs and standard of living. There are three (3) options that available here in the Philippines namely, Pag-ibig housing loan, In-House Financing (from house developer) and Bank Financing.
In-housing financing is a program offer by the developer who wants to buy through a series of payment. There is a minimal requirements but expect the bigger interest rate and bigger down payment than Pag-ibig and bank financing. As Pag-ibig member, you can avail their home loan services. Many banks nowadays also offers home loan.
- Interest Rate
Know interest rates so that you will decide the most favorable. Also consider other expenses aside from monthly amortization such as processing loan payment, taxes, title transfer fees and other related fees. You should educate yourself regarding housing loan and corresponding interest rate function.