Mortgage Info

[tylyn]

Me and my wife are moving back to Cebu from Australia

we have a very good deposit to buy our new home,can someone explain to me how it works with a mortgage as we are looking for a very nice property

i will still be working outside of the philippines

[Dave Hounddriver]

Interesting topic.  Every expat I know who buys property here uses sources other than a conventional mortgage because rates are high and requirements seem daunting.  I would love to hear from people who get mortgages in Philippines and are happy with them.

 

Buying from  a developer will often get you up to 2 years 'in house' financing if huge payments don't bother you but the last deal I looked at like that was an incredibly high rate of interest.  They told me 12% per year but they took the entire financed amount, multiplied by 24 (12% per year for 2 years they said) an divided it by 24 payments.  A look at an amortization chart would show you that the 1st world equivalent of that rate is about 22% per annum on the declining balance.

 

So getting a loan from your own country is a better way to go.

[Jake]

Me and my wife are moving back to Cebu from Australia

we have a very good deposit to buy our new home,can someone explain to me how it works with a mortgage as we are looking for a very nice property

i will still be working outside of the philippines

Hello Tylyn,

 

As Dave mentioned, many lenders (private or public) will use creative math to close out the deal.

You've been to PI before and I hope you and your wife are aware of the shenanigans that will

approach you, once they realize you're in the market.

 

For example, this taxis driver turned around (my wife and I were speaking English) and offered

to take us to his sister's so that we could see this custom built home with its own private cove.

After a two hour drive and a short banca boat ride, there it was sitting pretty overlooking a bay

(near Batangas, Luzon) with a manicured tropical garden.  

 

My wife Judy fell in love with it instantly.  But thank god, I was able to give her a reality check by

showing her my near empty wallet.  That whole excursion was on their dime (driver and sister)

but I did offer the driver some lunch, as he brought us back to Cavite.  He was so disappointed

that we couldn't accept the deal of a substantial down payment of 30% with a 5 year installment

plan.  I believe the 2 bedroom beach bungalow was going for 3.5 million pesos at the time.

 

I did ask him what about the owner, what about the title -- is it clean and duly recorded in a local

govt office?  He couldn't tell me -- in order words, he didn't care about the title, all he wanted was

a commission.  There are many more real estate agents like him, especially the plump old ladies

with the fake Gucci bags......he, he.  Please proceed with caution.

 

Welcome aboard sir -- Jake

Edited July 6, 2014 by Jake
spil chek

[Americano]

If you can't pay cash and it doesn't have a clear Title for the land its sitting on then its best to forget it. Very short and simple advice but probably the best you will find.

 

Clear Title means a Title with the person's name on it which you are trying to buy the house/land from and no other relatives or people are claiming they are owners too.

 

Its very important to see the Tax Declaration too so you will know who has been paying the property tax each year.

 

One more important bit of advice which many people do not think about. Tell them to show you the Concrete Markers placed in the ground when the lot was surveyed. There should be at least 4 markers. You need to see the Survey Drawing too. Do not accept a tree, bush or rock as being a marker. I have heard that so many times its ridiculous. Surveyors use round concrete posts planted in the ground just like in other countries. If someone tells you its a tree or bush then the land has not been surveyed or they are lying about the lot's boundaries.

Edited July 5, 2014 by Americano

[Jake]

Hey guys,

 

We've all heard the arguments before (rent vs own) and I feel it's worth repeating here.  First of all, shopping around for

a new home is like shopping for a new car.  Once you show (usually the wife) that you fell madly in love with the home-

property-car, they will have you by the balls.  If you can't walk away, even though you don't have a warm and fuzzy feeling

about it, they will have your wallet too....he, he.

 

Personally, I would canvas multiple areas within the same province for a decent place to rent.  I would never invest any

downpayment and get permanently locked in the contract where that beautiful home during the day, turns ugly during

the night.  You may be lucky to find a buyer to dump your new home but I doubt it, unless you're willing to sell it at a

reduced price because you can't tolerate your new neighbors anymore.  This is what I mean......

 

Some things to consider: (list is not all inclusive, appreciate other members inputs)

-- At your future residence, any chronic insect or rodent infestation; any evidence of past flooding or sewage backup

   due to drainage problems in home or street (stay away from low lying area)

-- Neighbors drinking session and playing loud karaoke late at night or roosters crooning "My Way" early in the morning

-- If willing to purchase house/lot/condo, are the titles clean???

-- Noise and environmental pollution to consider just outside your sub-division, such as a pack of barking dogs and

   having your kids run a gauntlet around their fresh droppings

-- Improper disposal of trash; nearby bars and nightclubs activities so your children will not be traumatized

-- Access to public transportation to international schools, hospitals, markets, shopping malls, immigration offices;

   airports

-- Peace and order situation in your immediate and regional area

-- Nearest consulate or embassy of your nationality in order to seek out a safe haven

-- CONTROL OF UNINVITED VISITORS -- BIG ONE!

 

Granted not all items can be satisfied according to your preference -- probably need to compromise depending on

your tolerance level.

 

Respectfully -- Jake

 

[JJReyes]

Me and my wife are moving back to Cebu from Australia we have a very good deposit to buy our new home,can someone explain to me how it works with a mortgage as we are looking for a very nice property i will still be working outside of the philippines

 

My recommendation is to rent at least one year before buying. If you still want to buy, pay for the purchase in cash. 

[Jollygoodfellow]

So getting a loan from your own country is a better way to go.

 

 

It might be but if you were trying for a home loan then I doubt if the foreign bank would give one. Where would they stand since a foreigner can not own land in the Philippines so how can they take a mortgage over a property that if the lender defaults where normally the bank can sell the property but in the case of the Philippines I would think foreign banks would not want to take a risk on lending.

 

 

 

Has anyone here ever got a loan from their own country to purchase in the Philippines?

 

One more thing the OP might look at since he is Australian, ANZ bank have a branch in Manila so that might be worth investigating. 

[Dave Hounddriver]

Has anyone here ever got a loan from their own country to purchase in the Philippines?

 

Yes, of course I would not recommend it unless speaking from experience, but you don't tell the bank (or in my case credit card company) all the details.  They are happy to think I am still residing in Canada and I don't have to tell them what the loan is for.  We move in sometime in September.  Because the prices here are less than in your home country then you just need to get a personal loan and don't confuse the bank by trying to tell them its a mortgage.  

[Americano]

 

Has anyone here ever got a loan from their own country to purchase in the Philippines?

 

Yes, of course I would not recommend it unless speaking from experience, but you don't tell the bank (or in my case credit card company) all the details.  They are happy to think I am still residing in Canada and I don't have to tell them what the loan is for.  We move in sometime in September.  Because the prices here are less than in your home country then you just need to get a personal loan and don't confuse the bank by trying to tell them its a mortgage.  

 

 

If they don't ask what the money is for then its their fault for not asking or maybe it doesn't matter as long as you pay it back as required.

[Dave Hounddriver]

 

 

Has anyone here ever got a loan from their own country to purchase in the Philippines?

 

Yes, of course I would not recommend it unless speaking from experience, but you don't tell the bank (or in my case credit card company) all the details.  They are happy to think I am still residing in Canada and I don't have to tell them what the loan is for.  We move in sometime in September.  Because the prices here are less than in your home country then you just need to get a personal loan and don't confuse the bank by trying to tell them its a mortgage.  

 

 

If they don't ask what the money is for then its their fault for not asking or maybe it doesn't matter as long as you pay it back as required.

 

I know one or more expats who never plan to pay back the money but its not something I am recommending here.  As you say, pay it back as required and there's no problem.  I am talking of amounts like 10K dollars or less.  Example:  Save up 10K dollars, borrow another 10K, and then buy a small house in a subdivision.  You can buy about a 35 sq meter house (more or less) in a low end subdivision for that in some cities here.

 

Just for an example, heres what you can get where I live for under a million pesos:

http://philsouth.com/portfolio-item/northville/