Home Improvement on a Budget for an SMDC Condo Unit

I figured I will turn this into a series of posts and this is Part I. Since I started several topics on real estate and budgeting, I decided to also share how my home improvement journey whilst saving money and paying off my loans.

After a year of living in my bare, unfurnished condo unit, I still didn’t save up enough money to start the renovation that I planned when I moved-in. I resorted to applying for a personal loan, and I got Citibank‘s approval within three days.

I got a bit too excited so I went ahead and I started with a budget of Php100K. From reading different blogs and inquiring from several contractors on Facebook, I already had an idea on what I could get with this amount. I first started by listing down what I wanted.

I knew I had to be realistic, so I ended up crossing out some “wants” from my list. When I asked for a quote from a contractor, I was disappointed (but not surprised) when he confirmed that my budget can only cover the following:

Overhead cabinet – Php16,800
Counter cabinet – Php15,000
Display cabinet – Php8,400
Closet – Php28,000
Partition wall – Php14,000
Repaint – Php14,000

TOTAL – Php96,200

This is a 2018 quotation so add around 5%-10% if you are reading this in 2020.

I originally planned to dismantle a portion of my kitchen countertop, but because I did not want to pay for the construction bond, I ditched the idea. That means we had to install cabinets on that part which have added more to the costs.

Related post:
Where to Find IKEA Furniture in the Philippines

And because everything was prefabricated and the scope of work was only described as “installation”, we also had to get rid of the repainting job.

I shelled out Php100,000 in total.

If you are planning to have your condo unit renovated, always include the construction bond in your budget. The bond normally ranges from Php20,000 to Php50,000 depending on the scope of work. This was not part of my budget so we had to make sure that everything is done in a day; the building Engineer did not approve more than that unless I pay the construction bond.

Here are some tips when looking for a contractor to renovate your condo with a very tight budget:

1. Check for contractors who have already done construction works preferably in other units in your complex. Their familiarity with how the process works in your building would be a big help. They would often post photos of their projects on Facebook and you could find them there when searching for the name of your building or residence.

2. Ask for a quote. Majority would ask for your budget so be upfront about that. Contractors would want to “adjust” to your budget. Note that lower costs would not only mean smaller work scope but cheaper materials as well.

3. Look for sample works, it’s very easy to find them on social media these days. Check for customer feedback or comments. If you cannot find them on Facebook, they are either just starting up which is not bad, or they are so hide-end that you can only speak to them by appointment.

4. Prioritize. Write down everything that you want and need along with their approximate costs. Then slowly remove the ones that you could let go for now until what is left meets your budget. In my case, I removed the drop ceiling and pin lights from my list.

Moving on, here are some before and after photos of my unit after the minor renovation:No full bedroom photo yet until I get a new bed. 🙂

Hiding half of the exposed beam with a customized cabinet was my first requirement. I might turn the other half in to a TV stand slash accent wall.
I originally wanted to get rid of the protruding end of the kitchen countertop, but I did not want to pay any fee to the building admin so we kept it. Thankfully, I like the finished product.
Almost a full view of my unit. I’m having my dining set customized and won’t be delivered until the end of next month, I’m using my old table for now. Lots of work to be done in my living room too.

So, I have all white walls and ceilings. I see them as a blank canvass which I’ll be working on for the next few months. This will put to test whatever is left of what I learned from my Architecture days. I started with basic furnishing, and I went all Scandinavian with my choices.

If you find this topic interesting, you can follow me on Instagram for more:

How a Secured Credit Card Helped me Improve my Credit Standing

While the Philippines has no established credit scoring system yet, banks have a way of checking if you have a a good credit standing or not. They can see if you have unpaid credit card debts or loans which will greatly affect their decision when you apply for a bank loan of any kind.

So, what to do if you have an unpaid credit card debt? Call your bank and come to an agreement on how to settle your debt. I have shared my experience in a previous post.

Related:
How to Get a Clearance for your Credit Card

Getting a secured credit card is a good option.

But it will take awhile for your name to get cleared from the “black list”, a term coined to refer to a shared database where records of unpaid credit card debts and loans are being kept.

With a secured credit card on hand, you will have to prove to the banks that you are already capable of managing your finances. You will need to of course use it but with extreme caution so that you won’t end up accumulating debt again as you did in the past.

It will take about a year or two before other banks will notice you. Within this time, you may start receiving emails or text messages from agents offering you loans or even credit cards. This is one of the signs that you are now slowly gaining back their confidence.

Be very careful about these offers though. I personally never entertained them at first. I did not need another credit card nor I have a huge reason to apply for a bank loan yet.

After almost two years, I eventually tried applying for a personal loan.

Citibank approved my application and not only did I received the money that I needed, it came with a credit card too!

It’s safe to say that I was able to re-gain our local banks’ trust after many years of having a bad credit standing.

Related post:
Security Bank Secured Credit Card or Fast Track Program









Buying a Condominium in the Philippines: In-House or Bank Financing?

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.

Related Articles:
All the Costs You Need to Know When Buying a Condo
Buying a Condo Unit: What You Need to Know
Condo Living: Expectation vs Reality

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?

Applying for a Home Loan in the Philippines

The biggest questions that I asked myself when I was looking for a condominium are; where should I apply for a home loan? Which bank will approve my home loan application? Which has the fastest home loan approval process? Is it going to be difficult? Or should I opt for in-house financing instead?

I went for bank financing, and at that time I had over four months to get a bank’s approval.
The realities started to sink in when I got my first rejection, it was from PSBank. PSBank was my first bank of choice because my friend who also applied to them a few months earlier got approved. I, on the other hand, never heard from them.

After two weeks, I anxiously submitted my application to China Bank upon the suggestion of my agent. I received a call after a few days for the usual verification process. Over a week later, the lady called me back and dropped the bomb – my loan application was denied because of an unsettled credit card debt with HSBC. I discussed this in this article:

How I Settled My Credit Card Debt

My biggest fear just came back to haunt me again. My agent was now asking me to call HSBC but I refused. I insisted that HSBC will no longer entertain me, and if they do, I might need to go through all the legal stuff which I was not prepared to do. The third rejection is from Metrobank, and next was UCPB. Both banks never get in touched with me; I imagined them literally throwing my application forms in the trash.

Four rejections in a row. That was my life already telling me to pay attention; it has almost gotten me into depression.

So which banks eventually approved my home loan application? And how fast?

First, I am giving a special mention to BPI.

My agent, being so patient urged me to try one more bank. He said he knows someone from the bank who could help. I started to not believe him anymore as that has been his usual line since we started. I completed the paperworks anyway, and he submitted them to BPI.

BPI called me and my brother (who is my co-borrower) after three days. The next week, they came back and advised me to get a Letter of Full Payment from HSBC. This is the bank clearance that I was talking about in this article:

How to Get a Bank Clearance for your Credit Card

That gave me the strength to ask; will my application be approved if I submit a clearance? The answer from the other line was a positive YES! And so days later, I decided to make that call. And the rest is history.

BPI eventually accepted my application but the total approved amount is less than what I needed. It turns out that they did not include my sister as a co-borrower, and me and my brother’s combined salary only qualify for a certain loan amount. To be fair with BPI, they kept my application active for at least a month and was regularly contacting me if I wanted to proceed.

UnionBank to the rescue!

With my permission, my ever persistent agent filled-out the UnionBank application forms himself and submitted them to UnionBank. He has copies of all my supporting documents so he did not even have to meet me at that point.

Their process is quite traditional. On the first week, an agent actually visited me at my apartment and conducted a C.I. and background investigation. Someone also went to our hometown in the far-flung province, and looked for my brother at our Municipal Hall where he works. My sister who is working abroad also had to give her employer’s email address for further checking. Overall, it was lots of work but quite fun. After all that we’ve been through, we readily complied to all their requirements.

On the third week, I finally received the best news I would hear that year.

Overall, UnionBank was quite strict but after having been denied by four banks, I did not feel being subjected to a long process anymore. My home loan was booked after two months, and before 2016 ended, I made my first monthly payment.

You might wonder, why didn’t I try BDO? For some reason, I did not think that BDO will approve my application. It was probably due to the quite strict and long process that I went through when I applied for a checking account with them a year earlier. I maybe wrong though, anyone who have positive experiences with BDO in terms of loans? Or do you have a similar story? Feel free to share by leaving a comment below.

Do You Have an MRI for Your Home Loan?

I was checking my loan amortization yesterday when I noticed the “MRI Premium” beside fire insurance. I’m sure the bank representative discussed this when I was signing my loan documents, but with hundreds of papers to be signed, I could no longer remember what this is (it took me an hour to sign all the documents!). All along, I thought fire insurance and MRI are one and the same. Obviously, I was wrong.
So what is a Mortgage Redemption Insurance or MRI?

It is basically a form of life insurance, or we could say, an insurance for our home loan. This means that in the event the borrower dies, the remaining balance of the loan will be taken care of by the insurance company (because it is insured). So the family of the borrower won’t have to worry about choosing to pay for the remaining balance, or have the property foreclosed.

Do we really need an MRI? 

Upon learning what an MRI is for, I felt better now that this is included in the monthly amortization of my home loan. Just like fire insurance, MRI is an inclusion to home loans from most (if not all) banks in the Philippines. If you do not have a life insurance, an MRI would be a good alternative.



But what if you have a life insurance, can you use that to replace an MRI?

PhilLife Financial discussed this in this article:

http://phillife.com.ph/how-to-avoid-paying-premiums-for-mortgage-redemption-insurance/

To quote a portion of their article;

“If you have an existing life insurance plan, you can negotiate with your bank by telling them that instead of the MRI, you would rather assign the bank as your beneficiary, allotting a portion of the sum assured to cover the amount you owe.

For instance, if you have an insurance plan worth P2 million, and the amount you owe the bank is, say, P800,000, you can ask your life insurance provider to assign P800,000 in favor of the bank. You can present this to your bank as proof that they will still get the money you owe in case something happens to you.”

I do have a life insurance with SunLife, but I haven’t really considered talking to my bank regarding this. I assume that they would not accept this option, since the MRI is a mandatory inclusion to the home loan.

Are you also paying for an MRI? How much?

How Much is Fire Insurance in the Philippines?

Do you have fire insurance for your condo?
How much are you paying for fire insurance?

My co-worker was asking me these questions yesterday. I remember about fire insurance being mentioned by my agent when I signed the loan documents at UnionBank last year. However, I forgot the exact figures; I took this is a reminder to check on my monthly amortization schedule again.
There you go. So, 
I am paying Php4,332.49 a year for fire insurance to Mapfre Insular. They are tied with UnionBank, and the fire insurance is mandatory which is added to my monthly amortization. I never really heard anyone talking about fire insurance before. And now that I think about it, isn’t earthquake insurance a more appropriate offering for condo owners in Metro Manila?

Do you also have a fire insurance for your property here in the Philippines? Share us your story by leaving a comment below.


Anyway, while looking at my loan amortization schedule, the MRI Premium caught my attention. I am going to talk about MRI in my next post.

How I Settled My Credit Card Debt

My credit card debt started to pile up in 2008. I had the card for only over a year, and by the second year, I was already only paying the minimum required payment. How did it happen? It was basically due to lack of knowledge about credit card usage.

I decided to stop paying in October 2010. I lost my card three months prior to that, and the replacement card that I requested was never delivered in my address. I dealt with customer service for three months that when I finally got the card, I immediately throw it away and decided to forget about it. And so I thought.

For the next few months, I started receiving calls, emails and letters from debt collectors often posing as lawyers. I became an expert at recognizing unwanted calls and in researching who those callers are. When I got a new job in 2012 and needed to travel abroad, my company submitted an application for an AMEX Corporate card for myself and was denied. We had to submit a notarized document in order to get the issuing bank’s approval.

The calls and emails stopped for awhile, but in early 2014, they came back. It became concerning at that point as the calls are actually coming in at work. Then in 2015, my siblings and I purchased a condominium unit under my name. That is when my credit card nightmare started (again).

I’d say, I always had the intention to eventually pay as I have been in fact saving money for it. But I just didn’t know how and where to start. A lot of things are holding me back, I was afraid that:

  • my bank might ignore me and refer me to the debt collectors. I was firm from the very beginning that I will never negotiate with debt collectors, ever.
  • my bank may accommodate me but I was afraid my debt has already earned very high interest which I could not afford to pay.
  • I might need to get a lawyer and deal with all the legal stuff.

All these disappeared with just one call!

See, all banks declined my home loan application because of my unsettled credit card debt. It took my agents over three months to convince me to call my bank. And the rest is history, you may check my previous post for the story:

How to Get a Bank Clearance for your Credit Card

So, how do you settle your credit card debt?



1. If your card is still active, meaning your latest payment due date has not passed one month yet, call your bank and ask for an amnesty. Negotiate and request for a supervisor if necessary. Be honest about your financial status and come to an agreement about payment terms and on deducting interests. You may be granted a payment term of up to six or twelve months depending on the total amount. Note that the bank’s decision will depend on your past paying habits. If you have been a very good payer for a long time, you may be given better options and considerations.

2. If you already stopped paying and you have already been receiving calls from debt collectors, you may:

    • negotiate with the debt collector
    • ignore them, save money, and settle with your bank at the soonest

Either way, you are going to pay anyway. I opted to negotiate with my bank, although it took me six years to do that. You don’t want to wait six years. The need to borrow from a bank may come anytime, and your credit card debt will definitely get in the way. Start considering calling your bank today.

3. Do you have multiple cards and are having a hard time paying them? You can seek assistance from the Credit Card Association of the Philippines (CCAP). The below article may be useful:

Get Help From The Credit Card Association of the Philippines – CCAP

Basically, they will help you consolidate your credit card debts through their Inter-bank Debt Relief Program (IDRP). Start by calling your bank, and ask if they are a member of CCAP, and is participating in the IDRP.

There may be lots of things which are holding you back right now. You may choose to settle your credit card debt today, or later. But one thing is for sure, it feels great when you finally get to receive that clearance. Peace of mind, at last. If you have been dealing with debt collectors for awhile, maybe this is the time to call you bank.

Are you also having problems paying off your credit card debt? Share us your story; feel free to leave your comments below.


What is a Consularized Special Power of Attorney

I encountered this while processing my home loan documents with UnionBank. Since my sister (who is my co-borrower) is working in Canada, I needed to sign all the bank documents in her behalf (unless she actually wants to fly back here in Manila). As a requirement, we had to submit a Consularized Special Power of Attorney.


Related post: New Authentication Process: Red Ribbon versus Apostille

Unlike a regular Special Power of Attorney (SPA) where you only need a lawyer to notarize the papers, the Consularized SPA needs to be brought to the Philippine Embassy in the country where the person involved is located. For our case, my sister went to the Philippine Embassy in Vancouver.

The process is quick and she was able to obtain the consularized SPA the same day. The SPA itself doesn’t need to be notarized, the officers inside the embassy will simply sign on it as witnesses, and is provided with a cover page with the consul’s signature and a red ribbon:

So, what do you need to bring when processing a Consularized Special Power of Attorney?

1. The SPA form itself. It doesn’t have to be notarized (rules may be different in other Philippine Embassies).

2. Your passport, and depending on rules of the Philippine Embassy in the country where you reside, you may need to bring an ID and additional documents. It is advisable that you call them first beforehand. You can go to ph.embassyinformation.com to lookup for contact information of Philippine Embassies worldwide.

Related post: New Authentication Process: Red Ribbon versus Apostille

How to Know if You Have an Existing SSS Loan

Whether you are wondering if you still have a loan balance or just want to find out if you can now renew your loan, calling SSS to verify or visiting one of their branches would be the best options. But if you have an online account, these information are just a few clicks away. If you do not have an online account yet, go to https://www.sss.gov.ph/ and register. Make sure that you are registering as a “Member” not as an “Employer. Also, use the latest version of Internet Explorer as some of the website functions do not work with other browsers.

Upon logging in, click on “E-SERVICES” and select “Apply for Salary Loan”. If you have an existing loan, the following message will appear:

From here, you can also check your loan balance and other details such as when the loan was submitted, your monthly amortization and the like. If you go to “Inquiry” you will find your profile details, and you can get a complete view of your total contribution along with your monthly premiums.