Having an own home is almost every Filipino’s dream. Since housing loans are generally large in amount, a form of payment security is needed.

However, not every Filipino is of a one-off payment. Most of citizen resort to obtaining a housing loan since it is the only way to get hold of their dream home. There are two types of housing loan options in the Philippines – through Pag-IBIG and bank financing.

There are many types of home loans in the Philippines offered by various companies. Almost every bank or private loan lenders in the country, if not all, offer housing loans and if you are new, the number of options and information could be overwhelming.

What is Housing loan?

A home (housing or mortgage) loan is a type of financing offered by a bank or a financial institution to a borrower for real estate purposes such as purchase, renovation, construction, and refinancing.

The basic people’s needs are food, shelter and clothing, among these 3 the most sought after need is to build a suitable shelter, this is where a Home Loan is considered.

Since this kind of loan involves a large sum of money, a form of collateral is required. Banks will hold the property rights for the house or real estate property until the loan is paid back in full. First of all, in order to understand this concept well, let’s consider at the different types of home loans available.

Types of Home Loans in the Philippines:

  1. Conventional Home Loan. This type of repayment scheme enables a borrower to properly manage his finances because the payments are predictable. Philippine banks provide their clients housing loans with a loan tenure of up to 20 years for a minimum of PHP 500,000.
  2. Flexible Home Loan. Borrowers can reduce their housing loan interest every time they deposit cash to their current account.

Compare best offers online for Housing loan in 2018

Everybody wants to avail of loans with the least possible interest rates and the most favorable terms. You can find the home loan online that is best for your by comparing different loan options. You could apply for a loan from public agencies such as PAG-IBIG and SSS or private lenders such as banks. But before you decide on which banks or lending companies you get your loan from, let’s take a look at the comparison between them when it comes to the lowest interest rates they offer:

Bank/Lending Institution Interest Rates Min. amount of Loan Max. Amount of Loan Min. Loan Tenure Max. Loan Tenure
BDO Home Loan 5.25 – 6.88 % PHP 500,000.00 PHP 100,000,000.00 1 year 20 years
BPI Family Housing Loan 5.5 – 12 % PHP 400,000.00 PHP 100,000,000.00 1 year 20 years
EastWest Bank Home Loan 5.5 – 11 % PHP 500,000.00 PHP 5,000,000.00 1 year 30 years
Metrobank Home Loan 5.5 – 10.5 % PHP 500,000.00 PHP 100,000,000.00 1 year 15 years
PBCOM Home Loan 6.5 – 8 % PHP 500,000.00 PHP 20,000,000.00 1 year 20 years
RCBC My Home 8 – 11.5 % PHP 300,000.00 PHP 5,000,000.00 1 year 20 years
HSBC Home Loan 5 – 6.5 % PHP 700,000.00 PHP 50,000,000.00 1 year 5 years
Maybank MaxiHome 6 – 10.25 % PHP 1,000,000.00 PHP 5,000,000.00 1 year 20 years
Equicom Home Loan 9 % PHP 300,000.00 PHP 100,000,000.00 1 year 25 years
CTBC My Family Home Loan 5.75 – 7.6 % PHP 500,000.00 PHP 25,000,000.00 1 year 20 years
Security Bank Home Loan 5.25 – 10 % PHP 1,000,000.00 PHP 100,000,000.00 1 year 20 years
Pag-IBIG Housing loan 5.5 – 10% PHP 450,000.00 PHP 6,000,000.00 1 year 30 years

How to apply for Home Loan?

Before you may apply for a home loan in the Philippines, there are certain aspects to look at first:

  • Credit score
  • Loanable amount
  • Interest rate
  • Loan tenor
  • Capacity to pay
  • Mortgage insurance

Before applying for a home loan, the following requirements must be met:

  • A resident of the Philippines with a valid Philippine billing address
  • Residential real estate property for collateral for existing homeowners
  • A tenure of at least 2 years for employed applicants
  • Must be operating profitably for at least 3 years for applicants engaged in the business
  • At least 21 years of age and not exceeding 65 years at the time of loan maturity

Prior to approval, the bank (or other lending companies) will dig in to these factors first, to check your capacity to pay your monthly dues. They’re going to ask you for your employment and/or business records, including your income statements.

How to apply for Pag-IBIG Housing loan?

Home Development Mutual Fund (HDMF) or simply Pag-IBIG provides a home loan instrument for all its qualified members. Find out how much you can borrow based on your income, preferred repayment term, fixed pricing period, and/or estimated value of the property you are meaning to buy.

Interest Rates (based on chosen Fixed Pricing Period)
1 Year 5.375%
3 Years 6.375%
5 Years 7.270%
10 Years 8.035%
15 Years 8.585%
20 Years 8.800%
25 Years 9.050%
30 Years 10.000%

Below are everything you need to know about the PAG-IBIG housing loan in the Philippines (Information taken from the official website http://www.pagibigfund.gov.ph/benpro.aspx):

PROCESSING FEE
  • P1,000 – upon filing of housing loan application with required documents (non-refundable)
  • P2,000 – appraisal fee (upon filing of loan application, non-refundable)
  • P2,000 – upon take-out (deducted from the loan proceeds)
BASIC REQUIREMENTS:
  1. Housing Loan Application with recent ID photo of borrower/co-borrower (if applicable) (2 copies, HQP-HLF-068/069)
  2. Proof of Income (see details below)
  3. One (1) valid ID (Photocopy, back-to-back) of Principal Borrower and Spouse, Co-Borrower and Spouse, Seller and Spouse and Developer’s Authorized Representative and Attorney-In-Fact, if applicable
  4. Transfer Certificate of Title (TCT) (latest title, Certified True Copy). For Condominium Unit, present TCT of the land and Condominium Certificate of Title (CCT) (Certified True Copy).
  5. Updated Tax Declaration (House and Lot) and Updated Real Estate Tax Receipt (photocopy)
  6. Contract-to-Sell or similar agreement between the buyer and seller
  7. Vicinity Map/Sketch of the Property
REQUIRED DOCUMENTS:
  1. TCT/CCT in the name of the borrower/co-borrower/s (if applicable) with proper mortgage annotation in favor of Pag-IBIG Fund (Owner’s Duplicate Copy)
  2. TCT/CCT in the name of the borrower/co-borrower/s (if applicable) (Certified True Copy) with proper mortgage annotation in favor of Pag-IBIG Fund (RD’s copy)
  3. Updated Tax Declaration (House and Lot) and Updated Real Estate Tax Receipt (Photocopy) in the name of the borrower/co-borrower/s, if applicable
  4. Loan Mortgage Documents
    1. Loan and Mortgage Agreement duly registered with Registry of Deeds with original RD stamp (HQP-HLF-162/163)
    2. Deed of Absolute Sale duly registered with Registry of Deeds with original RD stamp
    3. Duly accomplished/notarized Promissory Note (HQP-HLF-086/087)
    4. Disclosure Statement on Loan Transaction (HQP-HLF-085)

How to apply for SSS Housing loan?

Social Security System (SSS) has four housing programs with various purposes. These programs also have specific eligibility requirements a borrower has to meet. It is still a question if every SSS member can be qualified to buy a brand new home.

SSS has a Direct Housing Loan Facility for OFWs. This program and facility is designed to support the Government’s shelter program, which aims to provide socialized and low-cost housing to overseas Filipino contract workers.

Ok, let’s check what requirements need for apply SSS home loan (Information taken from the official website):

sss housing loan

Eligible Borrowers

The principal applicant must have the following qualifications:

  1. The borrower must be a member of SSS who has at least 36 months contributions and 24 continuous contributions in the period prior to application.
  2. Age of member is not more than 60 years old at the time of application.
  3. Member was not previously granted a repair and/or improvement loan by the SSS or NHMFC.
  4. Member has not been granted final SSS benefits
  5. Borrower and spouse is updated in the payment of their other SSS loan(s), if any.

Loan Purposes

The loan may be used to finance any of the following:

  1. Major repairs, particularly for dilapidated and structurally unsafe housing units;
  2. Improvements which shall apply to:
    • Extension or expansion and enhancement of economic and aesthetic value of an existing housing unit. Said improvements shall be permanently attached to the house.
    • Completion of an occupied bare house.
    • Construction of concrete fence and steel gate.
    • Installation of deep well and motor pump.

The Housing Loan Requirements in Philippines

While document requirements vary from lender to lender, the following are the most common ones, so you better keep these handy:

  • Passport
  • Driver’s License
  • PRC ID
  • Digitized BIR ID
  • Digitized SSS ID
  • GSIS E-card
  • Unified Multi-Purpose ID
  • Voter’s ID
  • Senior Citizen’s ID
  • Postal ID
  • NBI Clearance
  • Police Clearance
  • OFW ID
  • OWWA ID
  • Seaman’s Book
  • Alien Certificate of Registration/Immigrant Certification of Registration
  • Government Office and GOCC ID (examples: AFP ID, HDMF ID
  • Certification from the National Council for the Welfare of Disabled Persons
  • Department of Social Welfare and Development Certification
  • IBP ID
  • Company IDs registered with or supervised or regulated either by the BSP, SEC or IC

Sometimes doing your research may seem quite confusing – be persistent and ask questions! Researching can be a pain, but it is an essential part of ensuring that you get the best deal that suits your particular needs. Our website will help you compare online loans as easily and quickly as possible.