In one of my previous posts, I talked about my experience in applying for a home loan to several banks in the Philippines. If you are deciding whether to go for in-house instead, here are some fast facts about these two home financing options.

In-House
– Shorter loan duration, normally 5-10 years
– Higher interest rates compared to banks, basically due to the short loan terms
– High approval rate
– Less paperworks and requirements

Bank Financing
– Longer loan terms, between 10-25 years
– Lower interest rates, each bank offers different rates, and may change every 3-5 years
– Approval depends on your capacity to pay, and credit history
– More paperworks and requirements

If you have the money, I would recommend going for in-house financing. You can’t get rid of the paperworks, but it is a lot lesser compared to when you apply for a home loan in a bank. While the terms are shorter, and interest rates are a bit higher, it would still be more practical in the long run.

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Get a home loan from a bank if your priority is the lower monthly amortization. You may also find a bank that offers home loan promos such as rebates or low interest rates when you apply during a certain period of the year.

I went for bank financing because SMDC is not very keen at accepting in-house financing applications. They were not very enthusiastic about it when I inquired, almost discouraging me not to continue. Nonetheless, the chances of getting approved is high, at least according to the agents that I spoke with.

Are you also looking at these two home buying options? Which one are you more inclined to get?

6 thoughts on “Buying a Condominium in the Philippines: In-House or Bank Financing?”

    1. From UnionBank, actually. We never tried BDO for I had an impression that my chance of getting approved is low.

      1. Hello I came across your post as i’m going through the same scenario. BDO won’t approve my application together with my co-borrowers. It’s my first time to process a loan and i didn’t expect it will be this hassle. Does UnionBank offer better options?

        1. Union Bank accommodated my application and I think it helped that an agent was there to process my papers. For as long as you have complete requirements and pass their “CIs”, they’ll offer you something.

          I had a feeling that BDO will reject my application so I didn’t try them. If I were you, I’d ask why your application got declined so you’ll know what to do when you go to other banks.

  1. Hi everyone how to loan in philippines if you are working abroad? I reserve a condo to smdc and because of pandemic maybe i will need to loan please can you give me an idea step by step if your working abroad and want to loan to complete the full payment ,thank you

    Rosemarie

    1. You can go to your preferred bank’s website and apply for a loan from there regardless of your location. Most local banks offer this service online.

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