3 Pag-IBIG Housing Loan Alternatives

14 March 2022
3 Pag IBIG Housing Loan Alternatives

It's an accomplishment that anybody may be proud of when buying their first house. Many see it as a symbol of financial stability, while it is considered a status symbol for others. Furthermore, despite the difficulties imposed on by COVID-19, an increasing number of Filipinos searched out ways to become homeowners.


Pag ibig housing loan is the common desired loan for real property or house construction

Pag ibig housing loan is the common desired loan for real property or house construction

A common goal of working Filipinos and their families is to one day purchase a home of their own. As a result, most of us who want to purchase a house doesn't have enough upfront money for a down payment and closing costs. For this reason, most of the time, we apply for a house loan before moving through with the acquisition.


But consequently, no two house loans are precisely the same, just as no two homes are completely alike. In the Philippines, it's either the Home Development Mutual Fund (Pag IBIG Fund) or a private lender, such as a bank, the most popular source of financing for Filipino homebuyers, regardless of whether they're buying an apartment or a house and lot.


Although Pag IBIG housing loans is a popular alternative for Filipino homeowners, they can still have several other options available to them as well. There are various financing options available to help you buy the house of your dreams aside from having a pag ibig loan.


In this article, let's tackle the other ways to help you ease your burden for a home investment.


1. Bank Housing Loans

The bank is, without a doubt, the country's leading and foremost real estate finance institution. The reason for this is that you can select from several home financing products that they have to offer.


Overseas Filipino Workers' income stability has advantages in bank housing loan

Overseas Filipino Workers' income stability has advantages in bank housing loan

Other than this, in terms of bank housing loan, it's a positive thing that it has a lot of competition. You can grab this opportunity to try and shop around in choosing the ideal one for you based on some considerations—like your current income status, family's needs, and lifestyle.


Bank real estate loan must have a good credit history, employment history, and income qualified for monthly amortizations

Bank real estate loan must have a good credit history, employment history, and income qualified for monthly amortizations

But even with the more practical options that bank financing offers, the fact is, many individuals are still hesitant to receive a loan from a bank, in spite of the variety and adaptability that banks may provide. The reason for this is because of things like excessively high loan rates, protracted approval procedures, more stringent regulations, and increasingly short payment durations or loan maturity.


So let us help you in shedding light on why banks are one of your most excellent possibilities for obtaining your home loan finances.


Contributions and Memberships

When you would like to have a loan application for bank financing, there are no housing loan requirements such as fees or dues to join or contribute to a bank home loan, unlike in pag ibig fund in which you need to be a pag ibig member.


Interest Rates on Economic Packages' Housing Loans

For economic packages, 5.25 percent per year is the annual interest rate on the bank-financed house loan. In this case, Lumina Homes uses the typical interim rate of 8 percent for back simply for qualifying, but other banks provide as low as 5 percent after the down payment. After the loan is issued, so you don't already have to pay their interim financing for the loan.


Conditions of Payment

Payout terms for domestic workers are 20 years, but those working overseas are limited to 15 years to pay back. OFW and domestically employed loan candidates must have a net discretionary income of 30% or higher. On the other hand, those who are self-employed need a quarter of their net income on hand.


This only indicates that you may pay off your obligations more quickly and save more money by using bank financing, which has shorter payment periods. Additionally, banks are the only sources of credit that provide their customers with such latitude in terms of payment schedules and other conditions. You may quickly get in touch with them through phone, email, or in person at the local branch in your area. This is a boon since most towns, cities, and municipalities have various banks and other financial organizations. You also don't have to wait in a vast line or deal with lengthy transactions.


The amount that you can loan

As long as you meet the requirements, borrowers can also borrow up to 90% of the entire contract cost.


In addition to this, it's also easier to get a loan from the bank than pag ibig. As a result, the down payment required for bank financing is smaller than the one required for pag ibig financing, which is determined by the loan amount granted and the value of the property appraised.


An example of this scenario is that if the property is only worth 60% of what it is appraised, you will be responsible for 40% of the remaining balance. For those who can't afford to put more money down upfront, this means they'll have to pay more overall.


Period of the loan process

The comfort of having bank financing is it takes you only two to three weeks to get a loan. And even if your home isn't completely finished, the bank can still release your applied loan. This is great and favorable to the bank home loaner as your dream house might be yours sooner than expected if you pick bank financing for your home loans at this pace.


And the best part of this is Lumina Homes, one of the top-rated community developers in the country, partners with a variety of banking institutions to make home-buying easier for their customers. Some of Lumina Homes' partnered banks are:


  • Banco de Oro (BDO)

  • Cebuana Lhuillier Bank

  • AllBank

  • RCBC

  • UnionBank

  • UCPB

  • Security Bank

  • Maybank

  • China Bank Savings

  • Robinsons Bank


2. In-house Home Loans

An in-house home loan is a cinch to put together. There are just two parties involved in a real estate transaction: the buyer and the seller (the developer). While building a home, you'll find that your community provider operates like the bank. Construction of your new house is paid for by the developer, who receives your straight payment in return.


Most in-house financing needs a down payment (20 percent of the selling price) and amortization of the remainder for a certain period, like bank financing. This financing scheme also has a stake in the outcome. As the loan's principal and interest are repaid over time, you'll see a series of monthly amortization.


Housing loan approval are faster and no needed monthly contributions

Housing loan approval are faster and no needed monthly contributions

Homebuyers who don't want to deal with banks or pag-ibig housing loan companies or who can't qualify for a good loan may choose to employ in-house financing. Paying via a bank has a lower interest rate; however, paying internally has a higher interest rate.


In total, a short-term loan results in larger monthly payments but lower interest rates and a more affordable overall cost to the homeowner. As a result, long-term mortgages are beneficial for the budget in the short term but may end up costing a lot more over the long run.


With Lumina Homes, you can have up to 14 months of down payment term and a maximum of 15 years for your loan term.



Aside from bank financing and in-house financing, homebuyers can also resort to getting a personal loan from lending institutions or using a cash payment using their budget savings.


For spot cash, Lumina Homes are giving its clients some discounts in paying the full contract price of their preferred house and lot package:

  • 10% discount if the payment was made seven days within the reservation date

  • 8% if made within the reservation month

  • 6% if payment was made within 30 days from the reservation fee


If borrower's age is not qualified for the other financing, deferred payment or cash payment is another option

If borrower's age is not qualified for the other financing, deferred payment or cash payment is another option

Homebuyers in the country can now have more comprehensive options in order to avail of their dream home, and this is made so much better when you purchase a house and lot package from Lumina Homes. Get your home investment now and make your reservations with Lumina Homes.

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