Comparison Of Housing Loans Offered By Commerical Banks

Real estate marketplace MyProperty.ph compares housing loan interest rates of top-of-mind banks in the country.

To further assist fellow Filipinos in their investment planning, real estate portal MyProperty.ph creates a list of prevailing interest rates for housing loans this 2017 of various commercial banks in the country.

As investing in a home is one of the biggest purchase decisions one can make in a lifetime, it is imperative to study first and foremost the ins and outs of your current financial standing. Once you know the budget that you can allot for your future property you can then choose from the wide array of properties available in the market and distinguish the right financing scheme that suits you best.

The key to planning ahead is to be armed with the right information. Apart from finding out the lowest interest rates, it is likewise essential to dissect and differentiate the components of the home loan program offered. For instance, HSBC offers a very low interest rate compared to other commercial banks in the Philippines. Unfortunately, the minimum loan amount to be able to avail the program must be Php2 million. Therefore, if you are eyeing a property that costs less than this, HSBC’s offering will not be applicable to you.

Fixing Rate

In addition to interest rates, it is equally important to note the loan tenor of the fixed rate that you are agreeing to. All interest rates given in the table provided below falls under the one-year re-pricing period, this means that interest rates are subject to change per year. Although price change does not necessarily mean that rates will go up, it is still crucial to know and expect that your amortization fees will vary each year depending on the current interest rates.

Banks also offer a fixed interest rate for a longer span, the longer the tenor, the higher the interest. For example, BDO offers a fixed 6.5 percent interest rate for a length of two to three years and 6.88 percent fixed interest rate for a four to five years duration.

Margin of Finance

Most banks can lend up to 80 percent of the property’s selling price, while the remaining 20 percent will then be paid as equity or down-payment directly to the developer or the seller. Among all banks listed in MyProperty’s comparison, only Union Bank can lend up to a maximum of 90 percent of the property’s selling price. This is good news to some homebuyers who do not have enough cash to cover a 20 percent down-payment.

Loan Tenor

Unlike the government shelter agency Pag-IBIG Fund who offers loan tenors of up to 30 years, banks’ normal maximum loan tenor is only 20 years. Some extended their offering up to 25 years, while only EastWest Bank follows the model of the government bureau for offering 30 years tenure. Although paying in longer duration means your total payment will be higher, this helps lower monthly mortgage payments, which might be more manageable to some borrowers.

Fees and Charges

Miscellaneous charges vary from the requirements of each bank, but homebuyers must expect and be ready to spare some cash to cover these fees. Some of the common additional expenses included when applying for a housing loan are appraisal fee, registration, documentary stamp (Php1 for every Php200 of the loan amount), and notarial fee.

Mortgage Redemption Insurance

When applying for a housing loan, the bank or lender will normally ask the borrower to get a mortgage redemption insurance or MRI, which is a form of life insurance that pays off a part or the whole of the insured’s outstanding mortgage balance in case of his or her death or total disability. MRI guarantees the bank that it will be paid back the amount it has lent, and also protects the borrower’s surviving family, as it will help settle the outstanding housing loan amounts. In the absence of an MRI, the bank or lender may sequester the house from the surviving family. The MRI is usually incorporated to the housing loan in lump-sum payment (one-time premium paid annually).

Bank Fixed Interest Rate Margin of Finance Minimum Loan Amount Tenor Fixing Rate
HSBC Housing Loan 4.99% 80% Php2 million Up to 20 years For 1 year re-pricing
Security Bank Home Loan 5.25% 80% Php1 million Up to 20 years For 1 year re-pricing
BPI Housing Loan 5.50% 80% Php400,000 Up to 25 years For 1 year re-pricing
BDO Housing Loan 5.50 80% Php500,000 Up to 20 years For 1 year re-pricing
PNB Sure Home Housing Loan

 

5.75% 80% Php200,000 (depends on the property and area) Up to 20 years For 1 year re-pricing
Maybank Home Loan 6.00% 80% Php800,000 Up to 20 years For 1year re-pricing
EastWest Bank Home Loan 6.00% 80% Php500,000 Up to 30 years For 1year re-pricing
Union Bank Housing Loan 6.00% 90% Php500,000 Up to 20 years For 1year re-pricing
Metrobank Housing Loan 6.50% 80% Php500,000 Up to 25 years For 1year re-pricing
ChinaTrust Housing Loan Fixed Rate 6.75% 80% Php500,000 Up to 20 years For 1year re-pricing
China Bank Home Plus Loan 7.50% 80% Php500,000 Up to 25 years (depends on the property type) For 1year re-pricing
RCBC Savings Bank Housing Loan 7.70 80% Php300,000 Up to 20 years For 1year re-pricing


LAMUDI Affordable Housing Fair

The very first affordable-focused housing event organized by property website Lamudi Philippines will be participated by top names in the industry.

Lamudi officially opens the Lamudi Affordable Housing Fair at the Glorietta 3 Activity Center in Makati on February 15 to 16, 2017. On behalf of Vice President Leni Robredo, her Chief of Staff, Undersecretary Philip Francisco Dy will deliver her speech tackling housing affordability, one of the most sensitive shelter issues in the country at present.

The event will be graced by representatives from key government agencies and property developers. The ribbon cutting and housing affordability panel discussion will be headed by Undersecretary Philip Francisco Dy; Pag-IBIG Vice President Elmer Tugade; Managing Partner and Head of the Urban Planning Team of Palafox Associates, Karmi Palafox; and Lamudi Managing Director Bhavna Suresh Chathambeth.

CNN Philippines anchor Ruth Cabal will host and moderate the opening program and discussion that will dissect housing affordability issues, including a discussion on existing laws, strategies to overcome the housing challenge, and its impact to the country.

“To be part of the solution of making real estate affordable and accessible to all is maybe one of the biggest contributions that we have made for the industry in particular and to the country in general. This is only a first and we will continue to move and shake Philippine real estate,” said Ms. Suresh.

Key national shelter agency Pag-IBIG Fund and the Social Security System (SSS) are also represented in the fair. They will provide important details on various government programs and benefits related to housing that all Filipinos can avail. Likewise, both agencies will be part of the two-day real estate enrichment seminars to be offered in the fair. SSS will give a seminar detailing foreclosed properties investment guide on the first day, while the Pag-IBIG Fund will talk about how to finance a property on the last day.

Union Bank and Philippine Investment Two (SPV-AMC) will auction their foreclosed properties on the event. Union Bank auction is scheduled at 1–3 p.m. on the first day of the fair, July 15, while PI2 will bid their properties on the second, July 16, from 11 a.m. to 1 p.m.

Furthermore, aside from bringing developers that offer affordable housing together in one roof, the fair also tapped the best real estate professionals that will share updated and vital investment and real estate information to interested attendees. Day 1 talks include Growth Market Opportunities to be discussed by Mikko Barranda, Associate Director of Leechui Property Consultants; Investment Guide on Pre-Selling Condos by Jake Loria, Founder of therealestategroupphilippines.com; Real Estate Investing Options to be discussed by Gary Hablero, President and CEO of GH Heritage; and Selling Properties Online by Lamudi managing director, Bhavna Suresh.

The second day, on the other hand, will feature forums such as the Philippines’ Property Outlook by Joey Bondoc, Research Manager of Colliers International; buying your first home seminar will be talked about by Gabriel Dominguez, President of Green Circle Realty; rent-to-own properties buying guide and renting versus buying seminars will be discussed by Rem Ramirez of Philippine Institute of Real Estate Service; and Ryan Dela Cruz of Ferden Realty.

The housing fair will showcase the best value-for-money properties and will offer exclusive property discounts to home hunters. Exciting raffle prizes, giveaways, and activities are also up for grabs at the event. Zalora, Lazada, Uber, FoodPanda, Kickstart Coffee, and On Board Cafe are just some of the sponsors who will add more fun and convenience in home hunting.

Technology-assisted services such as virtual reality in real estate and home loan calculators available at the event will likewise add ease to the home-buying experience of fair attendees.

To know more about the Lamudi Affordable Housing Fair, visit the event’s official page.