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.

– 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?

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

      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.

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