Loans to Individuals for Housing Purposes

Objectives: To provide loan facilities to individuals for housing purposes for the acquisition, construction or improvement of a residential unit.

Target Market:

• Salaried Employees
• OFWs
• Professionals
• Other individuals with definite source of income

Features of the Loan Product:

• Interest Rate: 10%-19% p.a.
• Service Charge: 5%
• Processing Fee: 0.5%
• Term: Up to 10 Years

A.  Acquisition of Residential Lot

Loan extended for the acquisition of a residential lot will require cash equity of at least 20% from the borrower. Loan proceeds shall be directly disbursed to the seller of the property. The title of the property shall be in the Bank’s custody and encumbered with the Bank. If the borrower cannot make the cash equity, he/she may offer another unencumbered residential property as collateral with the loan value equal to or more than the required equity. Mode of payment shall be based on cash flow condition of the borrower. Encumbrances shall only be released upon full payment of loan.

B.  Acquisition of House and Lot:

Loan extended for the acquisition of a house and lot will require cash equity of at least 20% from the borrower. Loan proceeds shall be directly disbursed to the seller of the property. The title of the property shall be in the Bank’s custody and encumbered with the Bank. If the borrower cannot make the cash equity, he/she may offer another unencumbered residential property as collateral with the loan value equal to or more than the required equity. Mode of payment shall be based on cash flow condition of the borrower. Encumbrances shall only be released upon full payment of loan.

C.  Construction of a House:

The cost estimate of a notable contractor will be the basis for the loan amount. Loan proceeds will be released in tranches, based on the progress billings of the contractor. Before every tranche is released, the Bank shall make verification on the work in progress. The lot on which the house will be constructed shall be required as collateral for the loan. The constructed house will also be encumbered with the Bank.

Mode of payment shall be based on the cash flow condition of the borrower. Encumbrances shall only be released upon full payment of the loan.

D.  Improvements on a Residential Unit:

The cost estimate of a notable contractor for the required renovation/improvement will

be the basis for the loan amount. Loan release shall be based on progress billings of the contractor. The property to be renovated including the lot will serve as collateral for the loan.

Mode of payment shall be based on the cash flow condition of the borrower. Encumbrances shall only be released upon full payment of the loan.  Maximum loan term shall be for three (3) years only.