Step by Step Property Financing / Acquisition (How to Apply)
Step 1 - Different Types of Property Financing - Know Your Category
There are different ways of acquiring a property. However, the most popular is thru acquisition financing. If you have an existing pre-loved or repossessed asset, from banks or lending company or Pag-Ibig Fund that you wanted to buy, this fits your category.
On the other hand, if you are going to construct a property from zero, this falls under lending thru financing for construction. Another type of financing under this category is reconstruction or repair. Both category 1 and 2 above are harder to process and get a loan approval.
However tedious the process is, you'll find out it's going to be worth it if and when you get an approval. Under our team of expert consultants, we do occasionally process and help loan borrowers who fall under this category. But prior to your application, please be reminded that this type of loan takes a very long process to be approved. If you do not have the patience it takes to undergo a tedious process, we advise you to go get funding thru other forms of loan and buy in cash instead. But if you do not have the resources, then be prepared for the long wait.
Unlike property sangla, there will be more requirements and additional processing steps to be done before we can come up with a loan approval. Financing institutions like bank, private lenders and Pag-Ibig Fund do offer servicing loan borrowers under this category.
Step 2 - Submission and Securing Copies of Loan Requirements + Evaluation
Depending on what category you fall under, requirements may differ. For example, if you are applying for repair or construction from scratch, then you will need a comprehensive construction detailed plan. You may be required for an estimate costing and materials along with labor cost estimates.
But if your case is just to acquire an existing property or a repossessed unit, that is a different scenario. This is easier to process and get an approved loan amount. The only difference is that you will be required to pay between 20%-30% of the market value of the property you can to get financed. Both scenario 1 above and scenario 2 will require the same process of approval .
If you are buying property thru Pab-Ibig, you can find information regarding housing loan availment here- https://www.pagibigfund.gov.ph/document/pdf/citizencharter/Approved%20Citizen's%20Charter%20(Housing%20Loan%20Availment)%20-%20July%202017.pdf
On the other hand, different banks list their own file of repossessed properties open for acquisition financing on their respective website. Upon research, the cheapest available units I found this year of Covid-19 pandemic is in Metrobank. You can find their list of assets here - https://web.metrobank.com.ph/assets_for_sale.asp#
Step 3 - Evaluation and Authentication of Documents + C.I. and Valuation
Here, the value of your property to be financed will be estimated or appraised. For repossessed assets, the same valuation applies based from the ceiling price for sale according to the respective website.
Pag-Ibig lists their repossessed properties or acquired assets here - https://www.pagibigfund.gov.ph/acquiredassets.html .
In this process, the lending company is the one to decide if a document is sufficient based from their standards. The loan borrower must understand that there may be instances that a document is deemed incomplete or insufficient. If this is the case, additional requirements may be necessary to be submitted by the borrower.
All documents submitted must be valid copy and updated to the latest versione. You have to be sure of this part. A latest copy may be secured first and submitted before C.I. and appraisal is scheduled.
After complete documents / requirements are submitted, the borrower will be informed to pay for the C.I. and appraisal fee. This fee will be deposited only to the account of the lending company and not to the agent or loan broker. This will avoid any problems later so as the borrower, you have to make sure you are depositing to the right account name and number under the company or bank.
Step 4 - Loan Approval Process
The approval process takes at least 1 week and may be extended if any problems are encountered. Here, some of problems may be little technicalities but patience must be observed by the loan borrower.
Availability of the borrower is required all the time and any concern by the lender must be immediately address for fast process of loan approval.
Step 5 - Annotation of Title and Releasing of Loan Proceeds
After the lending company comes up with a loan approval, the next and last step is annotation of the title. The borrower will be requested to bring in all original documents and most importantly, the original copy of the property title being pawned for last minute authentication.
Annotation of encumbrance with Land Registration Authority will be the last process. Immediately after the annotation, the loan proceeds will be released to the borrower in the form of a cheque.